Résumé

Imperfect information and lobbying power often lead to imperfect regulations. This is particularly evident in the case of the Nitrate Directive, which aims to reduce water pollution from agricultural sources, but has faced significant resistance. We argue that farmers’ responses to this imperfect regulation may differ depending on whether they received economic incentives prior to its implementation. To test this, we focus on the Directive’s requirement for farmers to implement cover crops on plots located in Nitrate Vulnerable Zones (NVZs). The staggered entry of municipalities into NVZs provides a natural identification strategy. We apply difference-in-differences estimators to farm-level data from 2000 to 2020 in France. Our results show that NVZ entry significantly increases cover crop adoption among non-AES beneficiaries, with an average increase of 57\% after seven years. For AES beneficiaries, the increase is even more pronounced, with a 175\% rise in cover crop adoption. These effects strengthen over time, likely as farmers gain experience and reduce reliance on avoidance strategies. Additionally, we find that the regulatory impact varies by crop type, suggesting that changes in farming practices are influenced in part by the constraints imposed by the regulation.

Informations pratiques