Public preferences for post 2020 agri-environmental policy in the Czech Republic: A choice experiment approach

In November 2017 European Union commission presented a communication report summarizing the reform proposal of the post 2020 Common Agriculture Policy (CAP). The reform aims to address the environmental degradation associated with agricultural production as well as change in the structure of CAP payments. To this end, the Ministry of Agriculture in Czech Republic is preparing to set its priorities towards CAP's reform. In this study we applied a choice experiment to investigate the public preferences for a set of environmental goods and services delivered by agri-environment-climatic voluntary measures (AECMs). A mixed logit model is employed to elicit preferences and explore their heterogeneity. We find that respondents oppose strongly funding removal. Among environmental attributes, water and food quality are the ones with the highest implicit marginal willingness-to-pay values. Preferences for no funding option are heterogeneous with socio-demographic and attitudinal variables explaining some sources of this heterogeneity. A continuation of national funding for the AECMs is expected to lead to a better state of environment with an anticipated positive welfare change of 669–932 mil EUR as opposed to funding removal. The change reflects the estimated welfare change resulting from moving from a low to a medium or to a high preservation state of agri-environmental attributes. We also project the budget change for AECMs considering the level of national funding and given the transfer share between Pillar I and II. Based on our results, we suggest that national funding can be informed by the welfare change scenarios and transfer shares are projected accordingly.