CAP payments and agricultural GHG emissions in Italy. A farm-level assessment

The Common Agricultural Policy (CAP) is an important external driver of European agricultural production. Nowadays and in its envisioned future structure post-2020, the CAP has among its major objectives tackling climate change, for what concerns both adaptation and mitigation strategies. However, little is known about the link between past CAP reforms and agricultural greenhouse gases (GHG) emissions. This paper investigates the possible role played by the Fischler Reform (FR) on the agricultural GHG emissions at the farm level. The FR represents a major CAP reform for which data availability allows an ex-post analysis about its actual impacts. The empirical analysis concerns a balanced panel of 6542 Italian Farm Accountancy Data Network observed over years the 2003–2007. Multinomial Logit models are estimated in sequence to express how the farm-level production choices, and the respective emissions, vary over time also in response to CAP expenditure. Results suggest that CAP expenditure had a role in the evolution of the farm-level emissions, though the direction of this effect may differ across farms and deserves further investigation. [Display omitted] •Agriculture accounts for more than 10% of total CO2 emissions in the EU-28 area.•We estimate the CAP Fischler Reform possible impact on agricultural GHG emissions.•The analysis is carried out at micro level using farm level data.•CAP expenditure had a role in the evolution of the farm-level emissions.•Results are informative for the debate on future CAP reforms.