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GTAP Resource #5003

"How green is organic ? Indirect effects of making EU agriculture greener"
by Bellora, Cecilia and Christophe Bureau

Facing irreversible impacts on ecosystems as well as economic losses, EU authorities now try to promote environmentally friendlier agricultural production techniques. However, without a global environmental assessment, there is a risk of picking technologies that result in displacing part of the environmental problems abroad. In particular, should environmentally friendlier techniques result in a lower output per hectare in the EU, market driven effects might generate incentives to produce more intensively in other parts of the world, including in high natural value areas. We illustrate these possible effects by considering a partial, but significant, shift of EU agriculture to organic production. We attempt to gauge the extent in which local environmental benefits are offset by indirect ones in third countries using a variety of criteria. We use a specific version of a dynamic general equilibrium model with an improved representation of land use. We introduce a formal representation of organic production and a specific demand structure for organic products. The modeling of organic technology is grounded in micro data, which suggest that yields in EU organic production are still lower than those of conventional crops. We find that if 20% of EU land devoted to arable crops is converted to organic as planned by some member states, significant production displacements will take place unless the yield gap is reduced. The negative indirect effects on the environment appear limited compared to the local benefits of adopting greener forms of agriculture in the EU. However, in the case of greenhouse gases, the indirect emissions more than offset the local benefits of organic agriculture. Balancing direct and indirect effects is difficult, but in the case of chemical pollution as well as biodiversity, our results show that indirect effects are large enough to deserve being accounted for in Life Cycle Analyses.

Resource Details (Export Citation) GTAP Keywords
Category: 2016 Conference Paper
Status: Published
By/In: Presented at the 19th Annual Conference on Global Economic Analysis, Washington DC, USA
Date: 2016
Created: Bellora, C. (4/15/2016)
Updated: Bellora, C. (4/15/2016)
Visits: 1,220
- Land use
- Trade and the environment
- Agricultural policies
- European Union

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