Economy-wide effects of transitioning to organic agriculture: evidence from European regions

This paper assesses the regional economic impacts of transitioning to organic agriculture in the European Union by linking policy simulations from the IFM-CAP (Individual Farm Model for Common Agricultural Policy Analysis) model with regional input-output models. This multi-modelling approach evaluates how production changes propagate through regional economies via agricultural supply and manufacturing demand linkages across EU regions. Results reveal substantial regional heterogeneity, with economy-wide impacts ranging from moderate contractions to small gains depending on production structures and value-chain integration. Regions with strong agro-industrial linkages experience larger spillovers, while diversified economies are more resilient. The findings highlight the importance of spatially differentiated policy design for the EU's Farm-to-Fork strategy.