Environmental and farm impacts of the EU RDP agri-environmental measures: Evidence from Slovak regions

Abstract

Building on recent advances in the counterfactual impact evaluation, the paper illustrates the application of the area-based versions of the DID-matching and the Generalised Propensity Score Matching (GPSM) approaches to estimate impacts of the EU agri-environmental measures (AEM) on the quality of surface and underground waters, the GHG emissions from livestock as well as on economic results of farms supported by AEM in the framework of the Rural Development Programme (RDP) in selected two regions in Slovakia. The applied approach in combination with GIS and socio-economic (e.g. FADN) data allows to address several important sources of selection bias originated from disregarding important confounding site-specific factors that in majority of the AEM impact evaluations were treated as “unobservable” and from which many previous studies suffer. The approach is therefore highly relevant for assessing the impacts of the AEM in regions with diversified local site-specific characteristics. Another advantage of the applied approach is the coverage of the whole territory and calculation of impacts of the AEM support straightforwardly for the total area delineated by its territorial borders without an extrapolation of micro- results to regional/macro levels. Our estimates show that the effects of the AEM on the selected impact indicators were rather mixed but only in part favourable from a policy perspective.