Farmland Use Transitions After the CAP Greening: a Preliminary Analysis Using Markov Chains Approach

This paper represents a preliminary attempt to evaluate ex-post impact of the CAP greening payment on farmland use changes, testing by a Markov Chain approach whether farmland use transitions dynamics changed after the introduction of this new policy instrument. Unlike previous contributions, relying on ex-ante simulations, this analysis is based on the actual behaviour of farmers over the period immediately after the last CAP reform. Such ex-post assessment was based on real georeferenced data on farmland allocation, collected in the Lombardy Region, in Northern Italy, over the period 2011-2016. As the current CAP has recently entered in force (in 2015), the present analysis covers the first two years of implementation of the new rules along with the previous four years. Results are in line with previous ex-ante simulations in the same region, detecting a deep discontinuity for those farmland uses characterised by monoculture before the introduction of the greening. They show a significant discontinuity of farmland use transitions in the reference area after the introduction of greening rules, pointing to a decrease in maize monoculture, in favour of other cereals and legume crops like soybean and alfalfa. Unlike some critical opinions that see current greening rules as a “low profile” compromise, the present analysis points to a strong effect of such rules on regions with high-intensity agriculture.