The Integration of Environmental Issues in The Agricultural Policy: The Role of Economic Evaluation

The integration of environmental issues into agricultural policies has attracted significant attention in recent years. The objective of this paper is to discuss the (past and future) research questions in this area and the role of economic analysis in supporting decisions regarding the integration of environmental issues into agricultural policies, with a special focus on the Common Agricultural Policy (CAP) of the European Union (EU). The paper first examines the evolution of the process integrating environmental concerns into the CAP. Then, the role of economic analysis is discussed with reference to selected major issues, including: the evaluation of the relationship between agriculture and environmental impacts, and the economic value of such effects; the evaluation of policy effectiveness and efficiency; optimal policy design; the effects on markets and farm structures; and the coordination and governance of policy measures. The contents of these study areas are discussed and the research priorities required to meet future needs are identified. The work concludes by highlighting the need to develop more detailed policy analysis studies while, at the same time, developing a wider and more innovative vision of the role of agricultural policy in the global context.