The Effect of Mandatory Agro‐Environmental Policy on Farm Fertiliser and Pesticide Expenditure

Abstract

EU farmers are subject to mandatory cross-compliance measures, requiring them to meet environmental conditions to be eligible for public support. These obligations reinforce incentives for farmers to change their behaviour towards the environment. We apply quasi-experimental methods to measure the causal relationship between cross-compliance and some specific farm environmental performance. We find that cross-compliance reduced farm fertiliser and pesticide expenditure. This result also holds for farmers who participated in other voluntary agro-environmental schemes. However, the results do not support our expectations that farmers who relied on larger shares of public payments had a stronger motivation to improve their environmental performance.

The effects of off‐farm work on fertilizer and pesticide expenditures in China

“…The outcome variables include fertilizer expenditure per mu (1mu = 1/15 hectare) and pesticide expenditure per mu. Consistent with Jaraite and Kažukauskas (), expenditures are used rather than quantities because of significant diverse units of fertilizer and pesticide measurements used among farmers. The fertilizers used by farmers include farmyard manure, organic fertilizers and/or chemical fertilizers, and the pesticides contain chemical and/or biological pesticides.…”

“…The fertilizers used by farmers include farmyard manure, organic fertilizers and/or chemical fertilizers, and the pesticides contain chemical and/or biological pesticides. The independent variables are selected based on the existing literature on off‐farm work participation and farm input use (e.g., Abdulai & Delgado, ; Chang & Mishra, ; Jaraite & Kažukauskas, ; Matshe & Young, ; Owusu et al., ; Phimister & Roberts, ).…”

“… As many different varieties of fertilizers and pesticides are applied simultaneously, and/or used as substitutes by farmers, we use fertilizer and pesticide expenditures to proxy for the overall use of the two inputs. This is in line with previous studies that employed fertilizer expenditure and pesticide expenditure as outcomes owing to the diverse measurement units of these inputs (e.g., Jaraite & Kažukauskas, ). …”

Farmers’ Preferences for Production Practices: A Choice Experiment Study in the Rhone River Delta

“…Agri‐environmental payments may, in some cases, be necessary to motivate farmers to adopt environmentally friendly technologies. As Jarait≐ and Kažukauskas () conclude, cross‐compliance can be considered as a first step in improving the environmental performance of farms because ‘cross‐compliance reduced farm fertiliser and pesticide expenditure’.…”

Farm Level Costs of Agri‐environment Measures: The Impact of Entry Level Stewardship on Cereal Farm Incomes

“…Sneeringer () has used a DID approach to examine the effects of environmental regulations on the structure of the Californian dairy industry, finding evidence that regulation has led to a decline in the size of the industry in Southern California where there are more restrictive regulations. Jarait≐ and Kažukauskas () used a cross‐country DID analysis and concluded that cross‐compliance rules lead to a significant reduction in farm expenditure on fertiliser and pesticide. Sauer et al .…”