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Economic instruments as incentives for farmers to provide ecosystem services: issues and challenges

Agriculture. © INRA, INRA
Updated on 06/13/2018
Published on 02/15/2018

Current environmental problems call for an agro-ecological transition in agriculture. On an individual or group level, farmers can meet these challenges by adopting specific practices; this generally requires incentives, however, in the form of public policies.

Our research uses economics to analyse the challenges of regulating these environmental issues by mobilising farmers. We ask three questions:

- “Who?“ – to determine which professionals should be involved in regulation;

- “When?“ – to analyse the time scales of actions, their effects, and interaction between professionals;

- “Where?“ – to establish suitable geographic parameters to regulate environmental problems.

Answers to these questions are associated with a set of challenges for the design of regulatory tools. A critical analysis of various economic tools is presented in relation to these challenges.

A focus on Payments for Economic Services (PES) would highlight the virtues of these innovative instruments, but also their limits. The approach is illustrated using three stylised examples on the protection of emblematic species in agroecosystems; the development of biocontrol methods, and soil carbon storage.

By Vincent Martinet (INRA Versailles-Grignon and the SAE2 Division)