Applications of Principal-Agent Theory to Agricultural Land Use Policy

This book is based on the author's published research and uses the principal-agent methodology as a consistent framework for analysing and evaluating the development of the European Union's agricultural land use policy as it has evolved over the last two decades from voluntary set-aside to "compliance" set-aside to environmental stewardship. The book begins with an introduction to the principal-agent methodology and to the historical development of agricultural land use policy in the CAP (Common Agricultural Policy). There are also literature-based introductions which contextualise each major part of the book (Parts A and B). The book concludes with some reflections and forward-looking comments on policy design lessons from this research, which will be of use to students, academics and policymakers.

• Introduction
• Set-Aside as an Agricultural Land Use Policy in the European Union:
  • 'Nice Work If You Can Get It': An Analysis of Optimal Set-Aside
  • Set-Aside Premiums and the May 1992 CAP Reforms
  • Participation in Set-Aside: What Determines the Opting in Price?
  • The Impact of Price Support on Set Aside Responses to an Increase in Price Uncertainty
  • Land Heterogeneity and the Effectiveness of CAP Set-Aside
  • An Assessment of the Impact of Implementing the European Commission's Agenda 2000 Cereal Proposals for Specialist Wheatgrowers in Denmark
  • Using Principal-Agent Theory to Deal with Output Slippage in the European Union Set-Aside Policy
• Environmental Stewardship as an Agricultural Land Use Policy in the European Union:
  • Moral Hazard and Risk Management in Agri-Environmental Policy
  • On the Use of Targeting to Reduce Moral Hazard in Agri-Environmental Schemes
  • Land Heterogeneity, Agricultural Income Foregone and Environmental Benefit: An Assessment of Incentive Compatibility Problems in Environmental Stewardship Schemes
  • Adverse Selection in the Environmental Stewardship Scheme: Does the Higher Level Stewardship Scheme Design Reduce Adverse Selection?
  • Farmer Compensation and Its Consequences for Environmental Benefit Provision in the Higher Level Stewardship Scheme
  • Moral Hazard, Targeting and Contract Duration in Agri-Environmental Policy
  • Price Insurance, Moral Hazard and Agri-Environmental Policy
  • To Cheat or Not to Cheat: Moral Hazard and Agri-Environmental Policy
  • Reflections, Looking Around and L ooking Ahead