Table of Contents

Choice Experiments Informing Environmental Policy

Choice Experiments Informing Environmental Policy

A European Perspective

New Horizons in Environmental Economics series

Edited by Ekin Birol and Phoebe Koundouri

This innovative book is a compilation of state-of-the-art choice experiment studies undertaken in several European Union (EU) countries, including Finland, France, Greece, Ireland, Italy, Poland, Spain and the United Kingdom. The case studies presented concern a variety of environmental, agricultural and natural resource issues – such as the management of water resources, forests and agricultural landscapes; conservation of biodiversity and cultural heritage; noise pollution reduction and food labeling. The book highlights how the choice experiment method can be employed to inform efficient and effective design and implementation of various EU level agricultural and environmental policies and directives, including the Common Agricultural Policy, Water Framework Directive, Forestry Strategy, Habitats Directive and food labeling systems.

Chapter 4: Economic Valuation of Environmental Impacts in the Severely Disadvantaged Areas in England

Helen Johns, Nick Hanley, Sergio Colombo and Ece Ozdemiroglu

Subjects: economics and finance, behavioural and experimental economics, environmental economics, valuation, environment, environmental economics, valuation

Extract

Helen Johns, Nick Hanley, Sergio Colombo and Ece Özdemiroglu ˇ INTRODUCTION ‘Less Favoured Areas’ (LFAs) are areas where farmers receive compensatory allowances to make up for geographical factors resulting in higher agricultural production and transportation costs. The classification was instigated at the EU level in 1975 (Council Directive 75/268/EEC), and usually applies to hilly or mountainous areas, as well as some islands. Payments are also intended to acknowledge the role farmers play in maintaining the landscape and rural communities. In England there are two grades of LFAs, comprising mostly of uplands: Disadvantaged Areas (DAs) and Severely Disadvantaged Areas (SDAs). LFA designation is primarily intended to support farming in these less accessible places, rather than being an environmental designation. SDAs are often remote hill-farming areas which would face particular difficulty in maintaining economic competitiveness without subsidy. In England they include the Pennines, Lake District, Yorkshire Dales, North York Moors, Peak District, parts of the English–Welsh border, Exmoor and Dartmoor.1 Disadvantaged Areas tend to be slightly less hilly areas on the fringes of SDAs. LFAs in England receive different rates of payment under the Single Payment Scheme, and can also apply for Hill Farm Allowance (HFA) payments, worth in total about £27 million per annum, which have associated environmental conditions. This study was undertaken to feed into a revision of the HFA in 2005. The ultimate policy objective of the HFA revision is to reward sustainable land management and the provision of public benefits associated with hill farming....

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