Improving the environmental performance of agriculture is a high priority for OECD
countries. But measuring and evaluating the impact of agri-environmental policies
on the environment can be challenging, as it requires linking economic and biophysical
models in country-specific contexts. The OECD has developed the Stylised Agri-environmental
Policy Impact Model (SAPIM), which can be adapted and applied by researchers and policy
makers to better understand the impact of policies on the agri-environment conditions
in their countries. This report applies the model to representative farms in Finland,
Japan, Switzerland and the United States. These countries include a wide range of
objectives, policy measures and agri-environmental conditions. The results highlight
that when positive or negative environmental externalities are not taken into account
by farmers then the production choices by farmers will reflect private costs and benefits.
Policies can potentially raise social welfare by taking account of those externalities. This
report notes that, overall, the diversity of conditions across sectors and countries
makes it difficult to generalise the impact of agri-environmental policies beyond
the situations that are modeled. Nevertheless, some wider policy messages emerge.
Drawing on the four case studies examined, this report recommends that; polluting
activites that are not regulated should be included in policy design; the existing
overall policy environment needs to be taken into account in evaluating agri-environmental
policies; and environmental co-benefits and trade-offs need to be recognised. Green
growth policies can stimulate economic growth while preventing environmental degradation,
biodiversity loss and unsustainable natural resource use. The results from this publication
contribute to the Green Growth Strategy being developed by the OECD as a practical
policy package for governments to harness the potential of greener growth.