Abstract
In this paper, we investigate how farms' environmental and economic efficiency is shaped by Pillar I CAP subsidies over time and by spatial effects originating from subsidies received by neighbours. To reach this goal, we estimate a spatial stochastic frontier model including intra and inter province spatial effects and differentiate among environmental and economic outcomes to evaluate the direct and indirect effects of subsidies on both aspects. The results of the analysis indicate that on one hand, subsidies are helping farmers to achieve environmental sustainability especially after the 2013 reform, on the other, they are leading to increased economic inefficiency levels. Considering spatial effects originating from subsidies, we find positive and significant spillovers occurring among closest neighbours both from the economic and the environmental perspective.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
