Crop biodiversity repercussions of subsidized organic farming in Greece

Stefanos Nastis (), Anastasios Michailidis and Konstadinos Mattas

No 114628, 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland from European Association of Agricultural Economists

Abstract: This paper analyzes the impact of CAP financial assistance on crop biodiversity under uncertainty. A stochastic production function is employed and estimated to assess whether risk-averse farmers hedge risk by diversifying their portfolio of crops, thus increasing crop biodiversity. The model is applied to farm-level data of organic crop farms in Greece. Organic farming financial assistance poses a double-edged sword: even though it is considered agrobiodiversity enhancing as a cultivation method, subsidizing it can become agrobiodiversity reducing, since farmers may select to cultivate only the subsidized crops. The study shows that risk aversion leads to crop biodiversity conservation. However, providing CAP financial assistance on certain crops appears to decrease the relationship between revenue risk management and crop biodiversity, indirectly resulting in crop biodiversity loss.

Keywords: Crop Production/Industries; Farm Management; Resource/Energy Economics and Policy (search for similar items in EconPapers)
Pages: 9
Date: 2011-09-02
New Economics Papers: this item is included in nep-agr
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaae11:114628

DOI: 10.22004/ag.econ.114628

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