TARGETING AND SPATIAL IMPACTS OF AGRI-ENVIRONMENTAL SUPPORT – SPATIAL ECONOMETRIC ANALYSIS OF AGRI–ENVIRONMENTAL MEASURES IN SLOVENIA

The paper presents results of a spatial analysis of agri-environmental (A-E) measures in Slovenia. Spatial targeting and spatial patterns of A-E schemes are analyzed by a combination of exploratory spatial data analysis and spatial econometrics. Results suggest that A-E schemes in Slovenia are poorly spatially targeted against environmental priorities and needs in terms of water and biodiversity protection. This can be attributed to the fact that the most widely implemented A-E schemes in the country are implemented horizontally, with no spatially explicit criteria. Exploratory Spatial Data Analysis reveals spatial clusters of participation in A-E schemes, which is additionally confirmed by the results of the spatial econometric analysis. Participation in A-E schemes in general decreases with the average farm size of the area, and increases with per hectare CAP Pillar I payment rights and EAFRD payments. On the other hand, results of the spatial econometric analysis suggest that participation in organic farming appears to be a rational choice in areas with prevailing extensive, grassland-based farming. Results therefore suggest that farms maximize revenues from A-E schemes. Spatial clustering of areas with respect to the participation in A-E schemes occurs also in the absence of explicit spatial targeting and is closely linked with potential revenues from this source.