The new eco-schemes: Navigating a narrow fairway
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The new eco-schemes : Navigating a narrow fairway. / Latacz-Lohmann, Uwe; Termansen, Mette; Nguyen, Chi.
In: EuroChoices, Vol. 21, No. 2, 2022, p. 4-10.Research output: Contribution to journal › Journal article › Research › peer-review
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TY - JOUR
T1 - The new eco-schemes
T2 - Navigating a narrow fairway
AU - Latacz-Lohmann, Uwe
AU - Termansen, Mette
AU - Nguyen, Chi
N1 - Publisher Copyright: © 2022 Agricultural Economics Society and European Association of Agricultural Economists.
PY - 2022
Y1 - 2022
N2 - This article highlights some key challenges and trade-offs with which national policy designers have to contend in devising national eco-schemes for agriculture. We show that policy designers operate in a narrow design space which is constrained by various political and legal requirements. One key challenge is to design a reward system that allows the uptake of eco-schemes by farmers to be aligned with a given budget. We present four broad implementation models for eco-schemes and discuss their merits and shortcomings in light of stipulated requirements. These are the ‘greening model’, the ‘modified greening model’, the ‘eco-points model’ and the ‘AECS model’ in the style of the agri-environmental and climate schemes of CAP Pillar 2. We conclude that the eco-points model is likely to be the most suitable. By stipulating that individual farmers must reach a certain minimum number of points per hectare (eligibility threshold), but are not entitled to payments for points that exceed a certain upper limit per hectare (cut-off), it allows demand from farmers for inclusion in a scheme to be steered such that aggregate uptake coincides with the budget; thereby reducing the risk of over- or under-subscription while maintaining flexibility to cater for heterogeneity in site conditions.
AB - This article highlights some key challenges and trade-offs with which national policy designers have to contend in devising national eco-schemes for agriculture. We show that policy designers operate in a narrow design space which is constrained by various political and legal requirements. One key challenge is to design a reward system that allows the uptake of eco-schemes by farmers to be aligned with a given budget. We present four broad implementation models for eco-schemes and discuss their merits and shortcomings in light of stipulated requirements. These are the ‘greening model’, the ‘modified greening model’, the ‘eco-points model’ and the ‘AECS model’ in the style of the agri-environmental and climate schemes of CAP Pillar 2. We conclude that the eco-points model is likely to be the most suitable. By stipulating that individual farmers must reach a certain minimum number of points per hectare (eligibility threshold), but are not entitled to payments for points that exceed a certain upper limit per hectare (cut-off), it allows demand from farmers for inclusion in a scheme to be steered such that aggregate uptake coincides with the budget; thereby reducing the risk of over- or under-subscription while maintaining flexibility to cater for heterogeneity in site conditions.
U2 - 10.1111/1746-692X.12343
DO - 10.1111/1746-692X.12343
M3 - Journal article
AN - SCOPUS:85128299105
VL - 21
SP - 4
EP - 10
JO - EuroChoices
JF - EuroChoices
SN - 1478-0917
IS - 2
ER -
ID: 304364441