Evaluating the environmental impact of agricultural policies

Ben Henderson and Jussi Lankoski
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Ben Henderson: OECD

No 130, OECD Food, Agriculture and Fisheries Papers from OECD Publishing

Abstract: The relationship between agricultural support policies (adapted from the OECD Producer Support Estimate (PSE) classification) and a selection of environmental impacts are analysed in a range of country settings, using a farm-level and a market-level model. Based on the methods and environmental indicators used, market price support and payments based on unconstrained variable input use were the most environmentally harmful among the various PSE measures. Decoupled support payments based on non-current crop area were the least harmful, even when considering their impacts on the behaviour of risk averse farmers. The impacts of support policies that clearly change the competitiveness of one production activity in relation to another, such as payments based on current crop area or on animal numbers, were more equivocal. Support payments subject to environmental constraints can improve environmental outcomes compared to coupled support without restrictions, however, they can also have unintended environmental impacts.

Keywords: biodiversity; GHG; nitrogen runoff; nutrient balance; producer support (search for similar items in EconPapers)
JEL-codes: Q12 Q15 Q18 (search for similar items in EconPapers)
Date: 2019-05-13
New Economics Papers: this item is included in nep-agr and nep-env
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Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:oec:agraaa:130-en

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