Exploring the Linkages between farm efficiency, farm environmental performance, and agri-environmental scheme...

The agricultural detrimental effects on the environment are a source of concern. Public mea-sures, such as agri-environmental schemes (AES), have been designed to incentivize farmers to adopt more sound environmental practices on the farm. In this study, we examine the effects of past initial economic and environmental performances on AES adoption by focusing on crop farms. Using Firth's logistic regression to address small sample bias with French FADN data from 1997 to 2007, we mainly find that technical efficiency has heterogeneous effects on AES adoption, depending on environmental indexes. This result suggests the presence of windfall effects. We also show complex interactions (antagonism or synergy) between economic and environmental performances in adoption decisions, and heterogeneous effects depending on the type of farming. The agricultural detrimental effects on the environment are a source of concern. Public mea-sures, such as agri-environmental schemes (AES), have been designed to incentivize farmers to adopt more sound environmental practices on the farm. In this study, we examine the effects of past initial economic and environmental performances on AES adoption by focusing on crop farms. Using Firth's logistic regression to address small sample bias with French FADN data from 1997 to 2007, we mainly find that technical efficiency has heterogeneous effects on AES adoption, depending on environmental indexes. This result suggests the presence of windfall effects. We also show complex interactions (antagonism or synergy) between economic and environmental performances in adoption decisions, and heterogeneous effects depending on the type of farming.