Summary

1.1 Scope of Task 4.2
In this task, we focus on one of the contract solutions envisaged in WP1: land tenure contractual solutions. Land tenure-based contracts are contracts including land tenure arrangements with environmental clauses.
The objective of Task 4.2 “Modelling land tenure and land dynamics in AECPGs provision “ is to evaluate how the success of contract solutions is affected by different land tenure systems and how different contract solutions can affect land tenure and land markets.
In particular, this task focuses on:
a) How specific environmental lease contracts can be designed to promote environmental-friendly land use.
b) How the success of contract solutions is affected by different land tenure systems.
c) How different contract solutions can affect land tenure and land markets.
In accordance to the objectives of WP4 (simulations and performance of new contract solutions), modelling exercises are built upon the work carried out in WP1, WP2 and WP3 – respectively addressing the development of end-users-led contractual framework ; diagnostics of existing experiences on agri- environmental and climatic public goods (AECPG) and feasibility of new contract solutions for farmers and other stakeholders. In particular, WP1 and WP2 contributed to propose a theoretical set up of the models developed, while WP3 provided data. The models aim at understanding how contract solutions work and interact with the context and their anticipated results, with a focus on land tenure systems and land markets. When possible, models were complemented with sustainability indicators assessing performance and/or environmental impacts of the contractual solutions.
1.2 Deliverable outline
In this deliverable, we propose to report results of simulations and performance evaluations related to land tenure and land dynamics that have been conducted by the project partners involved in Task 4.2.
In the first part, we propose an agent-based model to investigate the design of environmental lease contracts that promote environmental-friendly land use. The effect of different contract types on a specific AECPG provision is tested, here an increase in biodiversity through the implementation of extensive grassland.
In the second part, we investigate whether land tenure status may have a differentiated impact on the adoption of an innovative result-based AECM compared to conventional action-based AECMs. We consider in particular the level of the land rent, assuming it reflects the agricultural productivity of the land enrolled, and the land tenure status (proportion of land rented). To do that, we identify a panel of observations from the Farm Accountancy Data Network (FADN) of farms (potentially) eligible to RB AECM during the last CAP programming period. We apply two Probit models to estimate on the one hand the probability to participate in a RB AECM, and on the other hand the probability to participate exclusively in action-based AECM.
In the third part, the impact of contract solution on land abandonment and land demand is addressed through the analysis of the effects of entire common agricultural policy (CAP) payments to prevent soil erosion due to climate change in hilly and mountainous areas. We consider explicitly the effects of an instrumental mix of policy on marginal land abandonment, in particular in Ligurian territories. The different policy mix impacts on land demand are simulated, using a mathematical programming model. The farmers’ behaviour is simulated considering different combinations of environmental demand implementation, such as enhanced conditionality, eco-schemes or agri- environmental schemes.