The Impact of Agri-environmental Schemes on Farm Performance in five EU Member States: a DID-Matching Approach

The agri-environmental schemes\r\n(AESs) of the European Union employ the highest\r\nshare of the public budget allocated to rural development\r\nprograms. Our study applies a difference-indifferences\r\npropensity score matching estimator to\r\nperform a comparative analysis of the effects of these\r\nschemes on farmers’ performance across five E.U.\r\nmember states. The effects of the AESs adoption\r\nlargely depend on the share of the agri-environmental\r\npayment on farm revenue. If this share is larger than\r\n5%, participation in AESs is effective in promoting\r\ngreener farming practices in all countries but Spain,\r\nwhere a negative effect on farm income is also shown.