Spillover Effects of CAP Greening Measures on the Economy and Biodiversity of Regional Europe: Evidence from Greece
Abstract
This study investigates the impact of the 2013 CAP reform related to green payments on the economy and biodiversity of rural Greece. As the literature had addressed only the impact on the agricultural sector, a regional input-output model was constructed to capture the direct and indirect effects of CAP greening on output, income and employment generation for a NUTS-2 region throughout the last implementation period 2013-2020. Input-output modelling was selected for impact analysis as it is suitable for short- and mid-term evaluations in a quick and easy manner. The Shannon’s diversity and evenness indices (SDI, SEI) were estimated to determine the effect of green payments on crop diversification in the studied period. Empirical results imply that while farmers’ net income decreased, green payments had a minor, yet positive, spillover effect on the regional economy and record on average 0.86% output growth, 0.65% income increase, and 0.43% more jobs created. Additionally, jobs created due to CAP greening provided resilience and a standard share of total regional employment, especially in times of crisis. The main goal of biodiversity increase is slightly achieved as SDI and SEI increased by 7.6% from 2016 to 2019. Further research is needed on the dispersion of income of Common Agricultural Policy payments in rural areas, particularly for those vulnerable to climate change.
References
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[21] Lakner, Sebastian, and Rainer Oppermann. (2018). A CAP-Reform Model to Strengthen Nature Conservation-Impacts for Farms and for the Public Budget in Germany. Austrian Journal of Agricultural Economics and Rural Studies, 27 (17): 129–37. DOI: https://doi.org/10.15203/OEGA_27.17
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[23] Louhichi, Kamel, Pavel Ciaian, Maria Espinosa, Angel Perni, and Sergio Gomezy Paloma. (2018). Economic Impacts of CAP Greening: Application of an EU-Wide Individual Farm Model for CAP Analysis (IFM-CAP). European Review of Agricultural Economics, 45 (2): 205–38. DOI: https://doi.org/10.1093/erae/jbx029
[24] Mahy, Louis, Bérénice Elisabeth Therese Ismée Dupeux, Guido Van Huylenbroeck, and Jeroen Buysse. 2015. Simulating Farm Level Response to Crop Diversification Policy. Land Use Policy, 45: 36–42. DOI:10.1016/j.landusepol.2015.01.003
[25] Matthews, Alan. (2013). Greening Agricultural Payments in the EU’s Common Agricultural Policy. Bio-Based and Applied Economics, 2 (1): 1–27. DOI: https://doi.org/10.13128/BAE-12179
[26] Mili, Samir, Lucinio Judez, and Rosario De Andres. (2017). Investigating the Impacts of EU CAP Reform 2014-20 and Developments in Sustainable Olive Farming Systems. New Medit, 16 (3): 2–10.
[27] Pardo, Adara, et al. (2020). To What Extent Does the European Common Agricultural Policy Affect Key Landscape Determinants of Biodiversity? Environmental Science and Policy, 114 (September): 595–605. DOI: 10.1016/j.envsci.2020.09.023
[28] Pe’er, Guy, et al. (2022). How Can the European Common Agricultural Policy Help Halt Biodiversity Loss? Recommendations by over 300 Experts. Conservation Letters, 15 (6). DOI: 10.1111/conl.12901
[29] Rotchés-Ribalta, Roser, et al. (2021). Assessment of Semi-Natural Habitats and Landscape Features on Irish Farmland: New Insights to Inform EU Common Agricultural Policy Implementation. Ambio, 50 (2): 346–359. DOI: 10.1007/s13280-020-01344-6
[30] Rudnicki, Roman, et al. (2023). Towards Green Agriculture and Sustainable Development: Pro-Environmental Activity of Farms under the Common Agricultural Policy. Energies, 16 (4). DOI:10.3390/en16041770
[31] Sauquet, Alexandre. (2022). Ex Post Analysis of the Crop Diversification Measure of CAP Greening in France. European Review of Agricultural Economics, 1–26. DOI: 10.1093/erae/jbac022
[32] Shannon, Claude E. (1948). Mathematical Theory of Communication. Bell System Technical Journal, 623–56. DOI: 10.1002/j.1538-7305.1948.tb00917.x
[33] Singh, Manpriet, Alexandru Marchis, and Ettore Capri. (2014). Greening, New Frontiers for Research and Employment in the Agro-Food Sector. Science of the Total Environment, 472. DOI:10.1016/j.scitotenv.2013.11.078
[34] Solazzo, Roberto, Michele Donati, Licia Tomasi, and Filippo Arfini. (2016). How Effective Is Greening Policy in Reducing GHG Emissions from Agriculture? Evidence from Italy. Science of the Total Environment, 573: 1115–24. DOI: 10.1016/j.scitotenv.2016.08.066
[35] Sotte Franco and Arcuri, Sabrina. (2025). The CAP 2014–2020. In European Agricultural Policy: History and Analysis, edited by Gianluca Sotte Franco and Brunori, 169–94. Cham: Springer Nature Switzerland. DOI:10.1007/978-3-031-83313-7_9
[36] Ueda, Tatsuki. (2022). Structural Decomposition Analysis of Japan’s Energy Transitions and Related ¬ CO 2 Emissions in 2005 – 2015 Using a Hybrid Input Output Table. Environmental and Resource Economics, 81 (4): 763–86. DOI: 10.1007/s10640-022-00650-9
[37] Wąs, Adam, Katarzyna Zawalińska, and Wolfgang Britz. (2014). Agricultural Policy on Sustainability of European Agriculture: From Perspective. Journal of Agribusiness and Rural Development, 4 (34): 191–212.
[38] European Commission. (2013). Sustainable Land Use (Greening). https://agriculture.ec.europa.eu/common-agricultural-policy/income-support/greening_en.
[39] European Commission. (2020). “The Business Case for Biodiversity. The European Green Deal.” Biodiversity: Finance and the Economic and Business Case for Action. Brussels, Belgium: European Commission. https://ec.europa.eu/commission/presscorner/detail/en/fs_20_907.
[40] FADN. (2022). “Farm Accountancy Data Network.” https://agridata.ec.europa.eu/extensions/FADNPublicDatabase/FADNPublicDatabase.html#
[2] Ando, Amy W. (2022). Equity and Cost Effectiveness in Valuation and Action Planning to Preserve Biodiversity. Environmental and Resource Economics, 83 (4): 999–1015. DOI: 10.1007/s10640-022-00674-1
[3] Barbier, Edward B. (2022). The Policy Implications of the Dasgupta Review: Land Use Change and Biodiversity. Environmental and Resource Economics, 83:911–35. DOI: 10.1007/s10640-022-00658-1.
[4] Bertoni, Danilo, et al. (2021). Estimating the CAP Greening Effect by Machine Learning Techniques: A Big Data Ex Post Analysis. Environmental Science and Policy, 119: 44–53. DOI: 10.1016/j.envsci.2021.01.008
[5] Birkhofer, Klaus, et al. (2018). The Contribution of CAP Greening Measures to Conservation Biological Control at Two Spatial Scales. Agriculture, Ecosystems and Environment, 255. DOI:10.1016/j.agee.2017.12.026
[6] Brutti, Zelda, Marzia Freo, and Laura Serlenga. (2025). The Causal Effect of Crop Diversification Obligations on Crop Diversity: An EU-Level Analysis. Ecological Economics, 237. DOI:10.1016/j.ecolecon.2025.108715
[7] Cortignani, Raffaele, and Gabriele Dono. (2015). Simulation of the Impact of Greening Measures in an Agricultural Area of the Southern Italy. Land Use Policy, 48. DOI: 10.1016/j.landusepol.2015.06.028
[8] Cortignani, Raffaele, et al. (2018). Green Payment and Perceived Rural Landscape Quality: A Cost-Benefit Analysis in Central Italy. Sustainability (Switzerland), 10 (2910). DOI: https://doi.org/10.3390/su10082910
[9] Cortignani, Raffaele, Simone Severini, and Gabriele Dono. (2017). Complying with Greening Practices in the New CAP Direct Payments: An Application on Italian Specialized Arable Farms. Land Use Policy, 61: 265–75. DOI: https://doi.org/10.1016/j.landusepol.2016.11.026
[10] Dabkiene, Vida, Tomas Balezentis, and Dalia Streimikiene. (2021). Development of Agri-Environmental Footprint Indicator Using the FADN Data: Tracking Development of Sustainable Agricultural Development in Eastern Europe. Sustainable Production and Consumption, 27: 2121–33. DOI: 10.1016/j.spc.2021.05.017
[11] Díaz, Mario, and Elena D. Concepción. (2016). Enhancing the Effectiveness of CAP Greening as a Conservation Tool: A Plea for Regional Targeting Considering Landscape Constraints. Current Landscape Ecology Reports, 1 (4): 168–77. DOI: https://doi.org/10.1007/s40823-016-0017-6
[12] Díaz-Poblete, Carmelo, María Carmen García-Cortijo, and Juan Sebastián Castillo-Valero. (2021). Is the Greening Instrument a Valid Precedent for the New Green Architecture of the Cap? The Case of Spain. Sustainability (Switzerland), 13 (10): 1–11. DOI: https://doi.org/10.3390/su13105705
[13] Diop, Thierno Bocar, and Lionel Védrine. (2025). Did Crop Diversity Criterion from CAP Green Payments Affect Both Economic and Environmental Farm Performances? Quasi-Experimental Evidence from France. Ecological Economics, 227:108405. DOI: https://doi.org/https://doi.org/10.1016/j.ecolecon.2024.108405
[14] Dupraz, Pierre, and Hervé Guyomard. (2019). Environment and Climate in the Common Agricultural Policy. EuroChoices, 18 (1). DOI: https://doi.org/10.1111/1746-692X.12219
[15] Erjavec, Karmen, and Emil Erjavec. (2015). ‘Greening the CAP’ - Just a Fashionable Justification? A Discourse Analysis of the 2014-2020 CAP Reform Documents. Food Policy, 51. DOI:10.1016/j.foodpol.2014.12.006
[16] Evans, Samuel G, and Matthew D Potts. (2015). Effect of Agricultural Commodity Prices on Species Abundance of US Grassland Birds. Environmental and Resource Economics, 62. DOI: 10.1007/s10640-014-9829-1
[17] Gaymard, Sandrine, Boris Goujon, and Marianne Lefebvre. (2020). Adherence to Environmental Regulation in the European Union Common Agricultural Policy: Social Representations and Conditionality among French Farmers. Journal of Agricultural & Food Information, 21. DOI: 10.1080/10496505.2020.1772078
[18] Gocht, Alexander, et al. (2017). EU-Wide Economic and Environmental Impacts of CAP Greening with High Spatial and Farm-Type Detail. Journal of Agricultural Economics, 68 (3). DOI: 10.1111/1477-9552.12217
[19] Hristov, Jordan, et al. (2020). Impacts of the EU’s Common Agricultural Policy ‘Greening’ Reform on Agricultural Development, Biodiversity, and Ecosystem Services. Applied Economic Perspectives and Policy, 42 (4): 716–38. DOI: https://doi.org/10.1002/aepp.13037
[20] Jezierska-Thöle, Aleksandra, Marta Gwiazdzinska-Goraj, and Małgorzata Dudzínska. (2022). Environmental, Social, and Economic Aspects of the Green Economy in Polish Rural Areas-A Spatial Analysis. Energies, 15 (3332). DOI: https://doi.org/10.3390/en15093332
[21] Lakner, Sebastian, and Rainer Oppermann. (2018). A CAP-Reform Model to Strengthen Nature Conservation-Impacts for Farms and for the Public Budget in Germany. Austrian Journal of Agricultural Economics and Rural Studies, 27 (17): 129–37. DOI: https://doi.org/10.15203/OEGA_27.17
[22] Lazíková, Jarmila, Anna Bandlerová, Ubica Rumanovská, Ivan Takáč, and Zuzana Lazíková. (2019). Crop Diversity and Common Agricultural Policy-The Case of Slovakia. Sustainability (Switzerland), 11: 1416. DOI:https://doi.org/10.3390/su11051416
[23] Louhichi, Kamel, Pavel Ciaian, Maria Espinosa, Angel Perni, and Sergio Gomezy Paloma. (2018). Economic Impacts of CAP Greening: Application of an EU-Wide Individual Farm Model for CAP Analysis (IFM-CAP). European Review of Agricultural Economics, 45 (2): 205–38. DOI: https://doi.org/10.1093/erae/jbx029
[24] Mahy, Louis, Bérénice Elisabeth Therese Ismée Dupeux, Guido Van Huylenbroeck, and Jeroen Buysse. 2015. Simulating Farm Level Response to Crop Diversification Policy. Land Use Policy, 45: 36–42. DOI:10.1016/j.landusepol.2015.01.003
[25] Matthews, Alan. (2013). Greening Agricultural Payments in the EU’s Common Agricultural Policy. Bio-Based and Applied Economics, 2 (1): 1–27. DOI: https://doi.org/10.13128/BAE-12179
[26] Mili, Samir, Lucinio Judez, and Rosario De Andres. (2017). Investigating the Impacts of EU CAP Reform 2014-20 and Developments in Sustainable Olive Farming Systems. New Medit, 16 (3): 2–10.
[27] Pardo, Adara, et al. (2020). To What Extent Does the European Common Agricultural Policy Affect Key Landscape Determinants of Biodiversity? Environmental Science and Policy, 114 (September): 595–605. DOI: 10.1016/j.envsci.2020.09.023
[28] Pe’er, Guy, et al. (2022). How Can the European Common Agricultural Policy Help Halt Biodiversity Loss? Recommendations by over 300 Experts. Conservation Letters, 15 (6). DOI: 10.1111/conl.12901
[29] Rotchés-Ribalta, Roser, et al. (2021). Assessment of Semi-Natural Habitats and Landscape Features on Irish Farmland: New Insights to Inform EU Common Agricultural Policy Implementation. Ambio, 50 (2): 346–359. DOI: 10.1007/s13280-020-01344-6
[30] Rudnicki, Roman, et al. (2023). Towards Green Agriculture and Sustainable Development: Pro-Environmental Activity of Farms under the Common Agricultural Policy. Energies, 16 (4). DOI:10.3390/en16041770
[31] Sauquet, Alexandre. (2022). Ex Post Analysis of the Crop Diversification Measure of CAP Greening in France. European Review of Agricultural Economics, 1–26. DOI: 10.1093/erae/jbac022
[32] Shannon, Claude E. (1948). Mathematical Theory of Communication. Bell System Technical Journal, 623–56. DOI: 10.1002/j.1538-7305.1948.tb00917.x
[33] Singh, Manpriet, Alexandru Marchis, and Ettore Capri. (2014). Greening, New Frontiers for Research and Employment in the Agro-Food Sector. Science of the Total Environment, 472. DOI:10.1016/j.scitotenv.2013.11.078
[34] Solazzo, Roberto, Michele Donati, Licia Tomasi, and Filippo Arfini. (2016). How Effective Is Greening Policy in Reducing GHG Emissions from Agriculture? Evidence from Italy. Science of the Total Environment, 573: 1115–24. DOI: 10.1016/j.scitotenv.2016.08.066
[35] Sotte Franco and Arcuri, Sabrina. (2025). The CAP 2014–2020. In European Agricultural Policy: History and Analysis, edited by Gianluca Sotte Franco and Brunori, 169–94. Cham: Springer Nature Switzerland. DOI:10.1007/978-3-031-83313-7_9
[36] Ueda, Tatsuki. (2022). Structural Decomposition Analysis of Japan’s Energy Transitions and Related ¬ CO 2 Emissions in 2005 – 2015 Using a Hybrid Input Output Table. Environmental and Resource Economics, 81 (4): 763–86. DOI: 10.1007/s10640-022-00650-9
[37] Wąs, Adam, Katarzyna Zawalińska, and Wolfgang Britz. (2014). Agricultural Policy on Sustainability of European Agriculture: From Perspective. Journal of Agribusiness and Rural Development, 4 (34): 191–212.
[38] European Commission. (2013). Sustainable Land Use (Greening). https://agriculture.ec.europa.eu/common-agricultural-policy/income-support/greening_en.
[39] European Commission. (2020). “The Business Case for Biodiversity. The European Green Deal.” Biodiversity: Finance and the Economic and Business Case for Action. Brussels, Belgium: European Commission. https://ec.europa.eu/commission/presscorner/detail/en/fs_20_907.
[40] FADN. (2022). “Farm Accountancy Data Network.” https://agridata.ec.europa.eu/extensions/FADNPublicDatabase/FADNPublicDatabase.html#
Published
2025-09-30
How to Cite
GKATSIKOS, Alexandros.
Spillover Effects of CAP Greening Measures on the Economy and Biodiversity of Regional Europe: Evidence from Greece.
Theoretical and Practical Research in Economic Fields, [S.l.], v. 16, n. 3, p. 564 - 674, sep. 2025.
ISSN 2068-7710.
Available at: <https://journals.aserspublishing.eu/tpref/article/view/9101>. Date accessed: 08 oct. 2025.
doi: https://doi.org/10.14505/tpref.v16.3(35).04.
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