Seminar with Marie Lassalas

Abstract

Environmental certification can be viewed as a complementary instru-ment to traditional agri-environmental policies to reduce environmental impacts of farming systems. However, these changes in agricultural prac-tices that are required when adopting an environmental certification might lead to an increase in financial risks and a decrease in perfor-mance. These perceived risks can thus prevent producers to adopt envi-ronmentally friendly practices. It is therefore crucial to quantify the level of performance change upon adoption of environmental certification. This article contributes to this issue, and aims at estimating the effects of environmental certification adoption on yield and product quality, two criteria that have an impact on farm revenue, through an empirical appli-cation on wheat production in France. The environmental certification considered here is defined at the plot level, and implies binding require-ments on pesticides use and the plot distance to main roads. We use an endogenous switching regression by full information maximum likeli-hood to control for potential endogeneity of the adoption of the environ-mental certification. The results show that there exists a significant selec-tion bias on the adoption of the environmental certification on plots when the outcome considered is wheat quality, but not when it is yield. In addi-tion, we find that the adoption of the environmental certification has a positive effect on both wheat yield and quality.
(with Sabine Duvaleix and Laure Latruffe).