European farmers’ responses to higher commodity prices: Cropland expansion or forestlands preservation?

The interconnection between commodity prices, agricultural expansion and forestland conservation by farmers has received little scholarly attention in existing literature. This paper analyses the influence of European farmers’ responsiveness to changes agri-commodity prices on how they manage trade-offs preservation. In so doing, we rely a comprehensive dataset relating holdings over period 2008–2017, covering 128 regions, use recursive equation system that links economic output per area, latter privately owned farmers. Controlling for farm characteristics, geographical spillovers as well regressor endogeneity, find results suggesting there is indeed evidence such trade-off. Specifically, with increased expand crop production (respectively land), which reversely conflicts private forestland. Replicating analysis different subsamples confirms robustness these findings. Based results, advocate further incentive towards preservation forests holdings.