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Assessing Farmers' Willingness to Accept "Greening": Insights from a Discrete Choice Experiment in Gremany

Uwe Latacz-Lohmann, Norbert Schulz and Gunnar Breustedt

No 170560, 88th Annual Conference, April 9-11, 2014, AgroParisTech, Paris, France from Agricultural Economics Society

Abstract: This paper explores farmers’ prospective responses to the “greening” of the Common Agricultural Policy. The analysis is based on discrete choice experiments with 128 German farmers. Participants were asked to choose between a “greening” option with a given set of management prescriptions and an “opt-out” alternative with a stipulated cut of the single direct payment. A binary logit model is used to identify the variables affecting the likelihood of “greening” being chosen. In addition, latent class estimations are carried out to group respondents into latent classes of “compliers” and “non-compliers”. We find that farmers” choices are driven by “greening” policy attributes, personal and farm characteristics, and interactions between these two groups of variables. Farmers perceive “greening” as a costly constraint, but not all farmers are equally affected and not all “greening” provisions are regarded as equally demanding. Specialised arable farms on highly productive land and intensive dairy farms are most likely to opt out of “greening” and voluntarily forgo part of their single payment entitlements. The paper concludes with a set of recommendations for improving the design of a second-best policy.

Keywords: Agricultural and Food Policy; Farm Management (search for similar items in EconPapers)
Pages: 31
Date: 2014-04
New Economics Papers: this item is included in nep-agr and nep-dcm
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DOI: 10.22004/ag.econ.170560

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