Assessing the risk of non-compliance in UK organic agriculture: An econometric analysis

Summary

The purpose is to provide an analysis of the risk factors influencing non-compliance in UK organic farming.
The paper uses a formal econometric model of risk analysis to provide empirical evidence on the determinants of non-compliance in organic farming. A panel of data from the archives of the largest control body in the UK for 2007-2009 is used, and specific analyses are performed for two types of non-compliances. A zero inflated count data model is used for the estimation, taking into account the fact that the occurrences of non-compliance are very sparse.
Results show the existence of strong co-dependence of non-compliant behaviours (i.e. the occurrence of major and critical non-compliance increases the probability of occurrence of the minor one; similarly the probability of occurrence of major non-compliance increases when minor non-compliance occur). Besides, livestock production and farm size are relevant risk factors.
Albeit highly representative, the findings are based on Soil Association data only and not on all UK organic farms.
The paper provides practical indications for control bodies, concerning aspects that could be strengthened for more efficient risk-based inspections. The paper advocates the use of financial information like turnover or capital stock, and of data concerning the characteristics of the farmers, that could substantially improve the probability of detecting the most severe non-compliances.
Certification is essential for organic farming, and an improvement of inspection procedures through a risk-based approach could add efficiency and effectiveness to the whole organic food system, with obvious advantages for consumers and the society as a whole.
This paper provides for the first time empirical evidence concerning the implementation of the organic certification system in the UK.