Smart Farming Technology and the Environmental and Social Efficiency of European Agriculture

The agricultural sector faces growing pressure to meet the increasing demand for food while mitigating environmental damage and being fair to farmers and rural populations. Current policy debates in the EU emphasise steering agricultural production systems towards achieving high social welfare and environmental sustainability. However, despite the increased focus on improving environmental and social sustainability, we lack appropriate tools to jointly evaluate performance in the environmental and social dimensions. One important tool for reaching increased sustainability is novel smart farming technology (SFT). Furthermore, the effects of SFT have scarcely been studied and need to be better understood to ensure that using SFT will contribute to the desired development. <br> This dissertation aims to provide insights into the current environmental and social performance of agricultural production and explore the potential of SFT to generate farm-level change in Europe. First, we examine the status quo of EU agricultural production. We consider a regional perspective and assess interrelated environmental and social efficiency scores in EU regions using Data Envelopment Analysis (DEA). We contribute empirical insights into how regional agricultural production in the EU balances environmental and social efficiency and suggest DEA as a feasible tool to assess the status quo. Second, we investigate the farm-level effects of SFT, considering what structural and behavioural changes the technology can induce. We follow the same efficiency analysis methodology as in the first part, but this time, we analyse the effects of SFT at the farm level. Specifically, we assess the effects of Automatic Milking Systems (AMS) on Norwegian dairy farms, including SFT-induced structural and behavioural change, which, in turn, can affect farms' environmental efficiency. To further understand SFT-induced structural and behavioural change, we use economic theory and previous literature to contribute a conceptual framework. This framework can be used in future studies assessing the farm-level effects of SFT, emphasising the structural and behavioural change SFT triggers on farms. <br> The findings in this dissertation provide valuable insights for guiding the sustainable development of the European agricultural sector and the role of SFT in this change. Our results show that policy needs to contribute to overcoming the trade-off between environmental and social efficiency to ensure sustainable agricultural development. For SFT to be part of a strategy to overcome this trade-off, SFT-induced structural and behavioural changes must be better understood and managed so that SFT promotes sustainable development without creating unwanted and adverse effects.