Abstract
Using a case study based in Veneto Region (Italy), the paper assesses whether the common agricultural policy influences the gross sellable product per hectare of utilised agricultural area, as a proxy of land productivity, and whether this effect changes according to different geographical areas (mountain, hill or plain). The regression analysis shows that the gross sellable product per hectare of utilised agricultural area is negatively correlated with the location of the farm in the mountains, confirming the existence of a gap between mountain and plain farms. The sellable product per hectare of utilised agricultural area is, moreover, positively influenced by the financial support of the first pillar for all farm locations with the exception of hill areas. The European payments of the second pillar, on the other hand, are positively correlated only with the gross sellable product per hectare of utilised agricultural area of hill farms. This trend, far from promoting a balanced and sustainable territorial development, is fuelling a dual agriculture with abandonment of agricultural land, together with environmental degradation and loss of biodiversity in areas with natural handicaps. The Farm Accountancy Data Network of 2015 is the source of microdata.
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Notes
According to the recent Council Regulation (EC) 1305/2013, LFAs are “Areas with Natural Constraints” (ANC); this included mountain areas defined as areas handicapped by a short growing season because of the high altitudes and steep slopes at a lower altitude, or because of the combination of the two.
The CAP recognises the payment scheme to compensate farmers for additional costs and loss of income resulting from natural constraints.
Indicator used in agricultural economics (Siciliano 2009).
A network developed at European level that collects accountancy data from farms for the determination of incomes and business analysis of agricultural holdings.
According to the FADN criteria, mountain farms are those placed above 600 m above sea level in the North of Italy (e.g. Veneto) and above 700 m in Southern and insular Italy. Hill farms are those located between 600 and 300 m above sea level, while plain farms are those that remain.
Only forest-based companies do not fall within the EU’s observation field.
For the selection of farms in the FADN sample, there are two main approaches:
The random selection from a list of farms derived from surveys on the structure of the farms.
The voluntary choice of companies, which always respects the selection plan.
In other countries, farmers receive a cash payment equal to or less than the sum paid by the EU for the completion of the FADN business card.
For instance, according to 2010 Istat census data, about 22.7% of Veneto farms had a dimension lower than 1 ha. In the FADN sample, instead those farms only represent 3.9%. In addition, in our sample the percentages of farms with a UAA lower than 1 ha are divided as follows: 4.8% of mountain farms, 6.7% of hill farms and 3.3% of plain farms. These percentages show that the FADN sample underestimates the farms with a low dimension for every altitude class; in fact, according to the 2010 Istat census data 19.9% of Veneto Region mountain farms have a UAA lower than 1 ha, 28.5% of hill farms and 21.4% of plain farms. Although the FADN sample is unbalanced in terms of “number of farms per UAA”, in terms of UAA the differences are much less pronounced. The percentage of UAA lower than 1 ha in the mountain is equal to 0.3 according to the 2010 Istat census, against 0.09% in our mountain sample. In the hill and plain, the percentages of UAA lower than 1 ha are 2.0% and 1.3%, respectively (Istat census 2010), while in the FADN sample they are equal to 0.24% and 0.06%, respectively.
We have excluded the dummy concerning the plain from the model in order to avoid the inconvenience of multicollinearity.
We have excluded the dummy concerning cultivation breeding from the model to avoid multicollinearity and the one referring to polybreeding as this is not relevant for the number of farms involved.
The classes are the following (thousands of euro): [8;25), [25;50), [50;100), [100;500), [500;1000) and from 1000. The dummies are codified as follows: d_EUD_1 equal to 1 if the observation falls in the last 5 classes (>= 25,000), d_EUD_2 equal to 1 if the observation falls into the last 4 classes (>=50,000), d_EUD_3 equal to 1 if the observation falls into the last 3 classes (>= 100,000), d_EUD_4 equal to 1 if the observation falls into the last 2 classes (>=500,000) and d_EUD_5 equal to 1 if the observation falls into the last class (>= 1000,000).
Highlighted in the Italian Strategy for Inner Areas (Governo Italiano 2013).
The GSP is defined by the FADN as, “the value of agricultural production obtained from the sale, both primary and processed products, self-consumption, gifts, in-kind wages, capitalization of cost for buildings and extraordinary maintenance, from the recovery animal welfare and public subsidies from the first pillar of the CAP”.
The EUD is the amount in euros of the farm’s standard production. The SP of FADN farms is instead measured as, “the monetary value of plant or animal production, including sales, re-utilization, self-consumption and the change in product stock”.
The TEO is the percentage of the SP of farms’ production activities compared to their own total SP.
The Veneto Rural Development Plan (RDP) for the 2014-2020 period has identified two environmental priorities: Priority 4—preserving, restoring and enhancing ecosystems—and Priority 5—promoting the efficient use of resources and the transition to a low-carbon economy. These environmental Priorities have over 398 million euros available, equal to 33.7% of the total financial resources (Regione Veneto 2015).
The amounts refer to the multiannual financial commitments of the programming period 2007–2013.
Equal to 1 if the farm is located in a mountain area, 0 otherwise.
The study focuses on the causes of abandonment of grasslands from 1990 to 2006 in the French Southern Alps.
Among the nine objectives of the future CAP, the environmental ones are: contributing to climate change mitigation and adaptation, as well as sustainable energy; fostering sustainable development and efficient management of natural resources such as water, soil and air; and contributing to the protection of biodiversity, enhanced ecosystem services and preservation of our habitats and landscapes (European Commission 2019).
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Zolin, M.B., Pastore, A. & Mazzarolo, M. Common agricultural policy and sustainable management of areas with natural handicaps. The Veneto Region case study. Environ Dev Sustain 22, 7587–7605 (2020). https://doi.org/10.1007/s10668-019-00537-8
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DOI: https://doi.org/10.1007/s10668-019-00537-8