Open Access BASE2010

Assessing the impact of different rural development policy design options on the adoption of innovation across five case studies in the EU

In: 118th Seminar, August 25-27, 2010, Ljubljana, Slovenia. 2010; 118. EAAE Seminar: "Rural Development: Governance, Policy Design and Delivery", Ljubljana, SVN, 2010-08-25-2010-08-27, 269-279

Bartolini, Fabio; Floridi, Matteo; Latruffe, Laure; Majewski, Edward; Nikolov, Dimitre; Polman, Nico; Viaggi, Davide; European Association of Agricultural Economists

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Abstract

Innovation and new technology adoption represent two central elements for the enterprise and industry development process in agriculture. The objective of the paper is to provide an ex-ante analysis of the effectiveness of alternative policy design options concerning the RDP measures intended to provide incentives for investment/innovation adoption in five case study areas across Europe. The model implemented is based on a real option approach that includes investment irreversibility and stochasticity in SFP. The results show the relevance of uncertainty in determining the timing of adoption and emphasise the importance of predictability as a major component of policy design.

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