Understanding the temporal dynamics of agri-environmental climate scheme adoption

Abstract

The research explores the intricate dynamics of farmers’ decision-making in the context of the European Union’s agri-environmental-climate schemes (AECS), with a focus on the temporal factors that impact participation and the long-term viability of environmentally friendly practices. The study utilises data from the Hungarian Farm Accountancy Data Network (FADN) from 2014 to 2021. It employs two-step approaches, including duration analysis using the Kaplan-Meier survival function and discrete-time duration logit, probit and complementary log-log models to examine the length of adoption and the determinants of the temporal dynamics of farmers’ decision-making in AECS. The results indicate the trade-off-based preference for market income over the AECS subsidy of Hungarian FADN farms, indicating a relatively weak relationship between adoption and maintenance. The research emphasises the importance of taking into account the farm business model (pertaining to farm characteristics) versus policy measures when analysing farmers’ choices regarding the (non)renewal of AECS contracts. The study provides valuable insights into farmers’ decision-making patterns in relation to changes in their participation in AECS over time.