The purpose of this paper is to analyse land allocation between competing agri-environmental contracts, taking into account institutional issues, the characteristics of the farm and farm household. Three types of agri-environmental contract are considered: a Biodiversity Protection Contract, a Landscape Management Contract and a Restriction on Intensive Practices Contract. The paper demonstrates that it is important to study the choices made between the different agri-environmental contracts. The reasons for this are that a unit of land can only be allocated to one contract (although the farm itself can choose to hold more than one contract) and the perceived relative marginal cost of a contract can change if the institutional setting, the farm household or the farm characteristics alter. The model uses a two-stage method. As a first stage, the probability of contract choice is determined. In the second stage these probabilities are linked to costs and the optimal contract choice is determined.agri-environmental contracts, contract choice,

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This article examines how clustering affects the entry and exit decisions of farm households into and from nonfarm enterprises in rural Ethiopia. We find that the existence of clusters of microenterprises in the same district increases the likelihood of a rural household to start a nonfarm enterprise. Similarly, clustering of big manufacturing firms in the same zone is found to increase the likelihood of farm households to start a nonfarm enterprise. Nonfarm enterprises operating in clusters are also found to have a lower probability of exit than those operating outside of clusters. The study further investigates the impact of entry and exit into and from nonfarm enterprises on farm household's well‐being using as indicators total household income, the food security status of a household, and the household's ability to raise enough money in case of emergency. Using propensity score matching to account for selection bias, we find that entry into nonfarm enterprises significantly increases household's income and food security status. Exit from nonfarm enterprises, on the other hand, is found to significantly reduce household's income.

We investigate whether milk quota abolition in the Netherlands is likely to lead to a shift towards more intensive farms, and whether the legislation introduced by the Dutch government to prevent this from happening is likely to be effective. To this end, a mathematical programming model is developed and applied to ten Dutch dairy farms of varying size. The mathematical programming model allows us to calculate shadow prices, which we use to evaluate the stability or likelihood of a shift in the farmer decisions in our model. Our results suggest a strong increase in intensity for the largest farm type when milk quotas are abolished, while further intensification is limited for the smaller farm types. Although most farm types increase the number of cows on the farm, for the smaller ones this can only be achieved when the costs of expanding decrease considerably. The new legislation introduced by the Dutch government to prevent strong intensification appears to be successful.

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