The European Union plays a major role as a research and innovation catalyst across European countries. Over the last decade it has implemented a broad range of research and innovation programmes to foster the transition towards more sustainable food systems. This chapter analyses the European Union’s Agriculture Knowledge and Innovation System (AKIS), its actors, and the related policy incentives and organisational structures. While the European Innovation Partnership for Agricultural Productivity and Sustainability is an important initiative with high potential to make enhanced productivity and environmental sustainability mutually compatible, resources devoted to agricultural knowledge and innovation are relatively limited compared to the total support provided to the sector and the adoption of innovation remains challenging. The chapter also identifies skills imbalances and examines the role of farm advisory services in addressing them. Enhancing digitalisation and further strengthening data strategies are key to improving the monitoring of EU policies, create awareness, facilitate knowledge exchanges, and to finding innovative solutions.
Policies for the Future of Farming and Food in the European Union
5. Innovation for sustainability
Abstract
Key messages
Research and innovation (R&I) play a prominent role in the European Union as key levers to achieving the environmental, economic and social sustainability of the agricultural sector. Horizon Europe’s far-reaching vision sets a strategic orientation for R&I, including in areas such as agriculture and food systems.
Unlike other sectors, agricultural research and development are financed primarily from public sources. The resources devoted to agricultural knowledge and innovation are relatively limited compared to the total support provided to the sector (6.1% in 2019-21). They mainly come from the budgets of individual EU Member States (over 90%).
The Horizon Europe programme and Pillar 2 of the Common Agricultural Policy (CAP) constitute the two main EU funding streams supporting knowledge and innovation in EU agriculture. While Horizon Europe offers funding to stimulate public and private investment in agricultural R&I and fosters multi-actor projects and partnerships across EU countries, the CAP provides targeted measures for relevant knowledge exchange, advice and co-operation (2.3% of CAP Pillar 2 in 2021).
The European Innovation Partnership for Agricultural Productivity and Sustainability (EIP-AGRI) is the European Commission’s main policy tool to channel CAP and Horizon Europe funding towards bottom-up multi-actor agricultural innovation projects that aim to tackle practical problems through a co-creation process involving farmers, researchers and other relevant actors.
The European Union also provides a framework for national and regional agricultural knowledge and innovation systems (AKIS). To strengthen national AKIS, the CAP 2023-27 required EU Member States to develop their strategic approach to AKIS and to increase collaboration between advisors, researchers and CAP networks.
While the sector experiences a high degree of skills shortages and mismatches, farmers’ participation in adult training is still low compared to other sectors. There is a growing need for skilled agricultural advisors to help shift skillsets and practices towards new sustainability demands, but the share of expenditure on instruments targeting farm advice in the CAP budget remains limited.
Some aspects of the overall regulation and policy environment in the European Union, such as the precautionary principle, may hamper innovation in certain areas, such as biopesticides, genetically modified organisms and new breeding techniques.
This chapter analyses the European Union’s Agriculture Knowledge and Innovation System (AKIS), the policy incentives and organisational structures that support this system, as well as their role in building a sustainable agricultural sector and rural areas. Section 5.1 outlines the main long-term visions for research and innovation (R&I) and their role in the transition towards more sustainable farming in the European Union. Section 5.2 presents the main actors, institutions, networks and knowledge flows in the EU AKIS. Section 5.3 looks at investments in knowledge and innovation, and provides insights into the performance of agricultural R&D. It also addresses cross-country co-operation in the field of R&I. Section 5.4 identifies the main skills imbalances in the agricultural sector and discusses policy responses. It also indicates the role of farm advisory services. Section 5.5 sheds some light on the complex relationship between regulations and innovation as well as the protection of intellectual property rights (IPR) in the European Union. Section 5.6 focuses on co-creation of innovations by farmers and the adoption of innovation and digitalisation on farms, while the last section provides a high-level reflection on transformative approaches to policies.
5.1. Long-term strategies for research and innovation in the agro-food sector
The European Green Deal (EGD) laid down a roadmap for the transformation of the EU economy, particularly in the energy, mobility and food subsystems (EEA, 2018[1]). As discussed in previous chapters, the need for transforming the agricultural sector is expressed in several strategies, including the Farm to Fork (F2F) Strategy, the EU Biodiversity Strategy for 2030 and the “Fit for 55” package (EC, 2021[2]).
R&I policies are explicitly mentioned in the EGD strategy as key levers of the transformation, including initiatives that seek to combine societal pull and knowledge push. The CAP 2023-27 also recognises the central role of innovation in achieving the environmental, economic and social sustainability of the agricultural sector. It emphasises the role of fostering innovation, co-operation, knowledge exchange and digitalisation in agriculture as key policy levers for modernising agriculture and rural areas. As such, the CAP’s cross-cutting objective, “Fostering knowledge and innovation”, is expected to help fulfil all the other policy objectives (Chapter 1, Section 1.1).
5.1.1. The long-term strategy for EU agro-food innovation is directed towards sustainable agriculture, but not all EU Member States have reflected it in their national strategies
The EGD vision is echoed in the Horizon Europe vision and in its first strategic plan for the period 2021-24 (Section 5.3). The Horizon Europe Strategic Plan formalises intervention areas, including areas of agriculture and food systems. It sets 4 strategic orientations and 13 expected impact areas, which “define the wider effects on society, the economy and science to be targeted by research and innovation activities, but not the manner in which to achieve them. This is entirely up to the imagination and skill of the applicants” (EC, 2021[3]). The strategic orientations most relevant to agriculture and food systems are “Restoring Europe’s ecosystems and biodiversity, and managing sustainably natural resources to ensure food security and a clean and healthy environment” and “Making Europe the first digitally enabled circular, climate-neutral and sustainable economy”.
The European Union’s long-term agricultural R&I strategy from 2016 has been a building block for the Horizon Europe Strategic Plan. The strategy defines five priority areas for R&I: 1) “sustainable resource management”, notably soil, water, nutrients and genetic resources, to achieve a balance between productivity and environmental goals in agriculture through efficient resource use; 2) “healthier plants and animals” to boost resistance to pests and diseases, including by developing prevention, monitoring and control plants tools and a holistic “one health” approach; 3) “integrated ecological approaches from farm to landscape level” to enhance the understanding of the potential of using ecosystem services to benefit sustainable agricultural production, including specific farming systems such as organic, mixed farming systems or agroforestry; 4) “new openings for rural growth” to stimulate the development of rural territories by exploring new avenues for business models, circular value chains, digital transformation, or economics of public goods; and 5) “enhancing the human and social capital in rural areas” through innovation networks, advisory services and demonstration sites in rural areas. Each of these five areas was further broken down into a set of targets (EC, 2016[4]).
The strategy also identified five cross-cutting issues related to the framework for R&I efforts in the European Union: 1) the need for system approaches, taking into account transdisciplinary and dynamic interactions; 2) societal engagement; 3) information and communication technologies (ICT) as an enabler; 4) enabling research and infrastructures; and 5) embedment of socio-economic research (EC, 2016[4]). Horizon Europe aims to structurally tackle these challenges through the transdisciplinary and cross-sectorial nature of the key strategic orientations for R&I and of their impact areas.
The European Commission has set ambitious transformation goals. Indeed, the European Commission’s far-reaching strategy for agro-food innovation is not fully reflected at Member State level and according to the OECD (2022[5]) survey for EU Member States, only 13 out of 19 countries reported having a long-term national strategy for agri-food innovation to guide their efforts.1
5.1.2. The transition to sustainable agriculture requires a system approach to innovation, embedded in the core of food systems
To respond to such high expectations of innovation for the transformation of the agro-food sector, innovation cannot be seen as business as usual and implies a specific reflection and tailored strategies. As stated in the F2F, “farmers, fishers and aquaculture producers need to transform their production methods more quickly, and make the best use of nature-based, technological, digital, and space-based solutions to deliver better climate and environmental results, increase climate resilience and reduce and optimise the use of inputs (e.g. pesticides, fertilisers)” (EC, 2020[6]). To undergo pathways of change towards these goals, farms should receive appropriate ecological, technological, market, policy and social stimuli and feedback, and transformation could imply removing system-related barriers to change. Such barriers include vertical (across levels of governance: European, national and regional) and horizontal (across policy areas: agriculture, environment, health, etc.) fragmentation of governance, which makes the co-ordination of actions around policy goals difficult, and implementation slow and conflicting.
Sustainable productivity growth in agriculture is likely to depend on improving the entire range of technologies and practices applied in the sector. In this context, innovations can contribute to achieving sustainability targets by improving and adapting existing technologies and practices to increase environmental performance (“changes in the system”), but also by creating new ways of producing and consuming, thus offering greater potential for transformation and reducing environmental pressures (“changes of the system”) (Weber and Rohracher, 2012[7]). Hence, “system innovation” (Box 5.1) could be broadly understood as a process where all types and components of innovation contribute to altering the resource base, knowledge base, critical skills, infrastructure and metarules that govern the system.
To generate system innovation, innovative processes and products should be widely adopted by users and enterprises. However, diffusion and uptake of innovations may encounter barriers (lock‑in factors), such as the costs for disinvestment of incumbent processes and products, enabling infrastructures, learning new procedures, or social acceptance of new products (Section 5.6). Moreover, there is also a need to support the creation of innovative enterprises and the development of an innovation-conducive environment where enterprises can find the resources (skills, human resources, service) they need to innovate. Hence, the required interventions go well beyond agricultural policies (OECD, 2015[8]).
Box 5.1. “System innovation” for the transition of the agricultural sector
The Oslo Manual (OECD/Eurostat, 2018[9]) defines innovation as “a new or improved product or process (or a combination thereof) that differs significantly from the unit’s previous products or processes and that has been made available to potential users (product) or brought into use by the unit (process).” However, innovation does not occur in a vacuum, but in a broad context as a change to the system that connects actors, artefacts and rules (Geels, 2004[10]). This implies that any change at the local level might trigger changes in other points of the system. In other words, transformative innovation occurs in the form of “bundles” “of mutually reinforcing technologies, policies, knowledge, social institutions and cultural norms” (Barrett et al., 2020[11]).
Innovations can be analysed by identifying their three components: technological, social and institutional. For instance, high nutrient-density products such as high-level Omega3 Italian Sheep Cheese or Selenium Potato (Selenella®) were obtained through genetic improvement and innovative agricultural practices (technological component). However, their success depends on consumers’ increasing interest (social component) and on institutional attention to nutrition reflected, for instance, in dietary guidelines (institutional component). Biological pest control is another example of innovation and is considered one of the cornerstones of the Common Agricultural Policy’s Good Agricultural Practices and of the proposed Regulation on the Sustainable Use of Plant Protection Products (see Chapter 4, Section 4.2). The technological component of this innovation is related to the selection of species for biological control and on agricultural practices, but the diffusion of this innovation also depends on its social aspect, i.e. the intensity of peer-to-peer learning processes between farmers, and on institutional support to these practices (e.g. Good Agricultural Practices). Machinery rings, which have been present in Europe since the 1960s, also display the interplay of different components of innovation. The principle of this scheme is to shift from individual to collective ownership of machinery (social component), thus helping farmers to match machinery and labour shortages on one farm with surpluses on another. Today, apps for machinery rings are being developed (technological component), allowing to balance demand and supply and substantially reducing the transaction cost. The wave of digitalisation of machinery (which makes it possible, for example, to localise machines and monitor their maintenance status) might substantially increase the uptake of this scheme. However, the successful establishment of machinery rings requires a set of legal and institutional conditions. The above examples show that policy makers can foster innovation by influencing each of the components of innovation.
Achieving the “sustainability transition” calls for placing the agricultural system within a broader system, i.e. the food system (den Boer et al., 2021[12]; Ingram and Zurek, 2018[13]). Applying the system approach to innovation implies here that farms and landscapes evolve in relation to changes in other parts of the food system, and at the same time their changes affect the other subsystems. In the transition envisaged by the F2F Strategy, agricultural systems are supposed to align their practices to social goals such as halting climate change, ensuring food security and nutrition, and restoring biodiversity. Given that each of these goals might generate trade-offs, the system approach is needed to find balanced and win-win innovation bundles. For instance, if at the level of the food system policies seek to steer demand towards highly nutritious and sustainable food products, and to shape Europeans’ diets towards more plant-based meals, the agricultural sector may respond (or be proactive) by producing more nutritious and low-footprint products, thus altering the production mix.
5.2. Governance and organisation of EU agricultural knowledge and innovation systems
AKIS2 are the most important drivers of agricultural innovation and, therefore, must play a key role in transforming the agricultural sector. The EU AKIS consists of a complex network of actors from regional, national and European levels, from both the public and private sectors, that generate, disseminate, and apply knowledge and innovation for agriculture and associated fields and promote and facilitate these processes.
Under the new CAP 2023-27 (Chapter 3, Section 3.5), EU Member States are required to integrate their AKIS strategies into their CAP strategic plans. Strategic actions aim at, inter alia, better integrating agricultural advisory services with other AKIS actors; enhancing knowledge flows between all actors and, in particular, research and practice; as well as promoting interactive innovation and digitalisation in agriculture (EC, 2019[14]).3 The decision on the selection of actions and the dedicated budget for knowledge and innovation lies with Member States. While a number of changes foreseen in the CAP 2023-27 have the potential to address some of the shortcomings of the previous CAP and strengthen the functioning of national AKIS, the analysis presented in this chapter only highlights the main expected changes without discussing them in detail.
Figure 5.1 provides a simplified illustration of the European Union’s knowledge and innovation ecosystem for the agricultural sector, including the main actors at the EU level, their roles in the EU AKIS in terms of knowledge flows and their links to farmers (EU SCAR AKIS, 2019[15]; Kania, Vinohradnik and Knierim, 2014[16]). It encompasses the public decision-making authorities and six broad groups of actors: farmers, research, education, advisory and extension services, the private sector, and others. The triangle of knowledge – research, education and extension services – highlights the particularly intensified interaction between these actors, with farmers being in the centre (FAO and World Bank, 2000[17]; EU SCAR AKIS, 2019[15]). Additionally, other actors, such as consumers, the media, non-governmental organisations, financial institutions, etc., may directly or indirectly influence the demands posed to the innovation systems and the creation and uptake of innovative solutions (including sustainable practices). While national actors are essential to build and strengthen their AKIS, the focus of this analysis is on the overarching EU framework for national AKIS.4
5.2.1. The European Commission provides a framework for EU Member States’ R&I policies
The public decision-making system sets the policy and institutional framework and provides funding to foster innovation for sustainable agriculture. It comprises multiple public authorities at the European, national, regional and local levels. At the national level, in many EU countries, governments, and in particular Ministries of Agriculture, play a crucial role in setting the strategic direction of innovation in the agro-food sector and are often considered the most decisive directional organ in this context5 (OECD, 2022[5]). At the EU level, the European Commission, preparing legislation in agreement with the Council and the European Parliament, is the overarching body that aims to provide guidance and directionality to the AKIS across EU Member States. When implementing the legislation, the European Commission supports co-ordination between their actors on a transboundary scale. To foster a stimulating environment for innovation across the European Union, it lays out rules and provides funding. The European Commission also aims to steer research to respond to agricultural challenges and the resulting needs for novel practical solutions (EC, 2022[18]; EU SCAR AKIS, 2019[15]), as further discussed in Sections 5.3 and 5.6. In this context, the Strategic Working Group on AKIS of the Standing Committee on Agricultural Research (SCAR) plays a particularly important role in EU agricultural innovation as a respected source of evidence-based expertise for EU policy making (Box 5.2).
Figure 5.1. Actors and knowledge flows in the European Union’s Agricultural Knowledge and Innovation System
Notes: This is a stylised, not a fully comprehensive, diagram: only selected EU-level actors and initiatives are depicted to provide concrete examples. Additionally, selected categories of actors from the national level are presented. The arrows indicate the directionality of knowledge flows, where dark blue arrows indicate the flows between general categories of actors; red arrows indicate flows pertaining to EU initiatives, networks and instruments; and light blue arrows indicate those specific to individual EU actors and/or initiatives. The categories of actors are not always sharply distinguishable but may overlap depending on the circumstances. The indication of knowledge flows is not exhaustive, i.e. only the most important ones are depicted. It should be noted that the directions of knowledge flows are not static but may change.
KIC: knowledge and innovation community of the European Institute of Innovation and Technology (EIT) (Section 5.3); EIP-AGRI: European Innovation Partnership for Agricultural Productivity and Sustainability (Section 5.6).
The European Commission’s Directorate-General for Agriculture and Rural Development (DG AGRI), is the most important actor responsible for agricultural research and innovation at the EU level. Given the cross-sectoral nature of agricultural research and innovation in the European Union, various other DGs may contribute to shaping AKIS. Although their work streams do not explicitly target agriculture, they may steer AKIS through their influences in areas such as education or digitalisation. DG AGRI is the responsible department for developing and carrying out the European Commission’s policies in the field of agriculture and rural development, and deals with all aspects of the CAP. Under Pillar 2 of the CAP, it provides EU Member States with a portfolio of types of interventions (measures), some of which have the potential to foster the EU AKIS, under the cross-cutting CAP objective on knowledge and innovation. Additionally, together with the Directorate-General for Research and Innovation (DG RTD) and the Directorate-General for Environment (DG ENV), it co-chairs Horizon Europe’s strategic Cluster 6, “Food, Bioeconomy, Natural Resources, Agriculture and Environment”, with a view to fostering agricultural innovation at large (Section 5.3). The European Research Executive Agency (REA), under the responsibility of DG RTD and DG AGRI, is the main executive agency responsible for managing EU R&I framework programmes, including projects on agricultural research in Horizon Europe Cluster 6.
Box 5.2. Advising research policies: The Standing Committee on Agricultural Research
Research policies can contribute substantially to policy co-ordination, as research provides the knowledge base for policy making. Given that Member States have their own research policies and funds, one of the objectives of European research policies is to develop a European Research Area (ERA) that aligns national research policies and fosters joint programming. In the agricultural sector, a specific body has been created to support this process: the Standing Committee of Agricultural Research (SCAR).
SCAR provides a place for interaction between the ERA countries on research and innovation (R&I) strategies. It has supported the development of the successive European Framework Programmes for Research and Innovation, including the current Horizon Europe Framework Programme (referred to as “Horizon Europe”). Its strategic working group on AKIS, the SWG SCAR-AKIS, has the explicit mandate to elaborate recommendations for improving the functioning of knowledge and innovation systems for agriculture and any interrelated area (e.g. environment, biodiversity, rural areas, food and non-food systems up until the retailer, consumer and citizen).
The strength of SCAR is that it brings together knowledge from 37 countries – all EU Member States, candidate Member States and states associated to the European Union. It also provides a very strong link to European policy making. It was established in 1974 through a Regulation of the Council of the European Union on the co-ordination of agricultural research, and in 2005 its mandate was updated to advise the European Commission and the Member States on the co-ordination of agricultural research in Europe.
SCAR work is articulated into “working groups”, composed of civil servants of the European Commission and Member States, as well as representatives from universities and research institutes. The “Foresight Group” develops ideas for foresight studies and, after approval, governs the execution of these studies. Foresight studies are the core of SCAR’s activity, as they involve all other groups to develop a shared vision. Collaborative working groups carry out mapping activities in specific areas and develop common research agendas. SCAR’s strategic working groups develop strategic insights on the themes of their competence, as, for instance, on AKIS by the SWG SCAR-AKIS.
Sources: SCAR (2022[19]); European Council (1974[20]).
5.2.2. Agricultural innovation involves a complex system, with numerous actors and knowledge flows connecting them
An innovation system is a network of knowledge flows that go in all directions (Figure 5.1). The innovation process is usually not a linear top-down process. All actors receive and transmit knowledge from and to other actors, and they all play a role in knowledge generation, transmission and adoption.
Farmers, as well as other end-users6 of project results, are decisive actors for the actual and effective uptake of innovation for sustainability and modernisation in the agricultural sector. Farmers are not only expected to apply innovative solutions on the ground, but to also be leading actors in defining sustainability challenges and co-creating their solutions, by leveraging the combination of acquired knowledge and advice with their own practical experience (EU SCAR AKIS, 2019[15]). Their co-decision in the projects also creates co-ownership for the results, which is an important incentive to adopt them. This can also accelerate the impact of the funded projects on the ground and in the field. Operational groups’ innovation projects and multi-actor research project and thematic networks under the EIP‑AGRI are discussed in Section 5.6.
Researchers provide evidence and contribute to the creation of knowledge within the AKIS that is necessary for the generation of sustainable innovation in agriculture. There are multiple agricultural research institutions in the European Union, i.e. national and regional research institutes, as well as universities. They should also learn from training, education and advisory actors on the needs, challenges and practices on farms. In addition, research institutes may be co-responsible for the implementation of innovation initiatives promoted by the government.
The Joint Research Centre has an important role as the European Commission’s science and knowledge service. It informs the European Commission on topics relevant to agricultural policies, ranging from challenges facing the sector to potential breakthroughs. It provides anticipation and foresight reports, including on new technological solutions relevant to thematic areas such as sustainable food production and consumption, or agricultural innovations. It also assists the implementation of the CAP and its instruments, including the Good Agricultural and Environmental Condition (GAEC) (JRC, 2022[21]).
The European Environment Agency is another example of an actor in the area of research. It focuses on providing sound and timely information on the environment to inform policy makers and the broader public on pressing environmental topics, including those related to agriculture. Through the European Environment Information and Observation Network (Eionet), the European Environment Agency gathers data on the environmental trends and pressures from Member States and makes them available together with research reports on possible solutions (EEA, 2022[22]).
The European Commission established the ERA with the ambition to create “a single, borderless market for research, innovation and technology across Europe”. It is fundamental to the European Union’s R&I ambitions as it fosters multi-scale connectivity and thus helps to leverage economies of scale and spillover effects among all agricultural research agents (EU SCAR AKIS, 2019[15]). Horizon Europe multi-actor projects, European Partnerships (e.g. “Agriculture of Data”) and European Missions (e.g. “A soil deal for Europe”) are examples of initiatives fostering collaborations in agricultural research and the establishment of relevant research infrastructures (more widely discussed in Sections 5.3 and 5.6).
Educators are key actors in ensuring that sustainable practices become better known and mainstream. Across EU Member States, there are various higher education institutions, vocational education and training (VET) facilities, and further educational providers in the agricultural and green sector that offer comprehensive and specialised education, supporting the build-up of capacities necessary to embrace innovation, e.g. in the fields of sustainability, bioeconomy and digitalisation, including agribusiness and entrepreneurship (Fields, 2022[23]). In this context, VET facilities are of particular importance to farmers as they provide lifelong learning opportunities that are necessary to enable the continuous uptake of knowledge and innovation on the farm.
The European Centre for the Development of Vocational Training (CEDEFOP) aims to foster VET, among others in the area of agriculture. It collaborates with the European Commission, EU Member States’ authorities and other partners to develop effective policies that foster and promote VET facilities, their capacities and their outreach (CEDEFOP, 2022[24]).
To enhance the transmission of relevant skills and foster collaboration between the European Union, Member States and key stakeholders, the European Commission established the European Education Area. Green education is one of the main themes through which the European Union aims to encourage educational institutions to support the green transition and strengthen competences for sustainable development across Europe.
Another example is the European Network of Learning and Teaching in Agriculture and Rural Development, an association of educational bodies specialised in the agricultural sector. It serves as an exchange platform for teaching and learning in agriculture that aims at developing and transmitting agricultural knowledge through improved and novel teaching processes (ENTER, 2022[25]). Additionally relevant to the sector is EUROPEA, an association comprising more than 1 000 vocational schools and institutions across Europe that are represented by 25 national EUROPEA networks. The organisation is dedicated to developing and promoting VET in Europe’s green sectors by focusing on improved international co-operation and knowledge sharing. To do so, it fosters participation in EU-funded VET projects and the dissemination of its results, for example, in the area of digitalisation or circular economy (Europea, 2022[26]).
Agricultural extensionists/advisors, private and/or public, offer information and advice directly to farmers. They are expected to co-operate closely with representatives of science and education, both to remain abreast with new research and to raise research and educational needs identified through interactions with farmers.
The European Forum for Agricultural and Rural Advisory Services is a body assembling a number of agricultural advisory services at the European level. It aims to contribute to the development and interactions between advisory services within the European Union. To this end, it advocates their needs, provides information and has also participated in a few EU projects to foster and strengthen European farm advisory services, e.g. the i2connect project that aims at connecting advisors, increasing their competencies and facilitating interactive innovation processes (EUFRAS, 2022[27]). A further discussion on the role of advisory services within the EU AKIS and relevant actors follows in Section 5.4.
Farmers’ unions and co-operatives act as a direct meeting point to obtain and exchange practical training and advice in the context of ever-changing markets or the application of more sustainable agricultural practices. In addition, they represent the voice of European farmers to public authorities and advocate their needs among all AKIS players. At the EU level, Copa Cogeca is the largest organisation, representing more than 22 million farmers, their unions and co-operatives across the European Union. It contributes to the ongoing EU policy discussion and the definition of priorities in the sector by defending farming interests (Copa Cogeca, 2022[28]).
Private sector actors from agriculture and industry, such as small and medium-sized enterprises, multinational enterprises, producers of inputs or processors of outputs also play a key role in the EU AKIS. While they often follow their own innovation agendas and activities, they may also engage in multi-actor collaborations in the field of agriculture, at the national and/or international level. The European Union, as well as national governments in many countries, aim to incentivise private investment in R&I for agriculture. Such incentives most often take the form of grants or loans, and slightly less frequently public-private partnerships (OECD, 2022[5]). Private sector participants, such as input suppliers, for promotion purposes, often maintain close ties with both research and educational facilities, and farmers to whom they provide information on “best practices”. However, such advice is not disinterested and supports the marketing of their own products.
Growing interest in strategic networking may foster greater synergies and stimulate inclusive knowledge exchange
Several EU knowledge and practice networks (Figure 5.1) contribute to improving the design and implementation of policies and measures at the EU and Member State levels. The European Network for Rural Development and the EIP-AGRI network were “networks of networks” established by the European Commission under the rural development pillar of the CAP. Until 2022, they aimed to increase the involvement of relevant stakeholders (e.g. from research, public authorities, local action groups and advisories) and share good practices on the implementation and evaluation of rural development programmes, thus also contributing to knowledge exchange and innovation, but also to policy learning. The EIP-AGRI Network has been particularly important in linking knowledge and innovation projects and actors, such as farmers, advisors, researchers and operational groups (ENRD, 2016[29]; EU, 2019[30]).
Due to the increased need for stakeholder engagement, knowledge sharing and capacity building under the CAP 2023-27, the scope of networking has been extended to encompass the whole CAP. In this context, the European Network for Rural Development and the EIP Networks have been transformed into a single EU-wide CAP network, while national rural networks have been replaced by national CAP networks (Figure 5.1). This change aims to further stimulate stakeholders’ involvement in CAP strategic plans and support the implementation of the plans; foster peer-to-peer learning, interaction at all levels, inclusive knowledge exchange and innovation; capacity building, including related to monitoring and evaluation; and help disseminate the results of the CAP strategic plans and of the EIP-AGRI Operational Groups (Skakelja, 2018[31]).
5.3. Investment in knowledge and innovation, and R&D outcomes for the agro‑food sector
Innovation and knowledge exchange are considered to be the primary drivers of productivity growth and greater environmental sustainability. Public and private research and development (R&D) investment is fundamental to foster long-term productivity growth (Heisey and Fuglie, 2018[32]). The global evidence clearly shows that economic returns on agricultural R&D investment remain high (Rao, Hurley and Pardey, 2019[33]).
5.3.1. Public and private investment
Agricultural knowledge and innovation are financed primarily from public sources, with relatively limited resources compared to the total support provided to the sector
Public investment has always played a significant role in financing agricultural knowledge and innovation. This is largely justified by the public good7 nature of most agricultural research. To incentivise private sector investments, governments provide direct support or exclusion mechanisms such as patents. In areas where these mechanisms are insufficient to spur private investment, government-financed research prevails (Heisey and Fuglie, 2018[32]).
Over 2019-21, the European Commission, EU Member States and EU consumers transferred, on average, more than EUR 100 billion per year to support the agricultural sector (Total Support Estimate). The vast majority was provided to individual producers (87.7%), and only 12.0% for general services to the sector (GSSE), which, through the provision of public goods and services, can create enabling conditions for the development of the agricultural sector and improve its competitiveness (OECD, 2022[34]).
Transfers to agricultural knowledge generation, agricultural education and extension services (collectively referred to as “support to agricultural knowledge and innovation systems”) totalled EUR 6 billion, which corresponds to around half of the GSSE (Figure 5.2). Although over the last 15 years, expenditures on knowledge and innovation systems relatively gained in importance in the support structure (an increase from 4.6% of total support in 2006-08 to 6.1% in 2019‑21), it was mainly due to the decline in the support provided to other general services, such as development and maintenance of infrastructure. This positioned the EU27 above the OECD average (4.1%), but behind Australia (24.4%) and Canada (8.8%) (OECD, 2022[34]).
Figure 5.2. Composition of support to agriculture in the European Union, 2019-21
Note: European Union refers to EU28 for 2019; EU27 and the United Kingdom for 2020; and EU27 for 2021.
Source: OECD (2022[35]).
Well-targeted, strategic investments in agricultural knowledge and innovation are essential for the green transformation of the sector
The European Union and EU Member State governments combine direct investment in R&D activities with other instruments to foster collaboration and facilitate knowledge exchange. Strategic investments in creating, sharing, and the uptake of knowledge and innovation have the greatest potential for improving the sector’s capacity for sustainable growth and making it more resilient to shocks (OECD, 2022[34]). To effectively support the green transition of the sector, they have to be aligned with its global objectives: for instance, the EGD target of increasing the agricultural area under organic farming in the European Union to 25% by 2030 (Chapters 3 and 4) should be accompanied by appropriate investments specifically targeting organic farming actors and related knowledge, e.g. agroecology.
Knowledge and innovation are mostly financed by individual EU Member States, i.e. 91% of EU spending comes from national budgets; the rest is provided by the EU budget, either through selected measures under the rural development pillar of the CAP or through Horizon Europe Cluster 6 (OECD, 2022[35]). Overall, there is no direct evidence of a crowding-out effect of national public investments by supranational ones. Yet, co-ordination and alignment of different funding streams remain of the utmost importance. Moreover, the European Union should focus on topics and partnerships with high EU added value and essential to achieving strategic goals rather than focusing on specific national priorities and interests (LAB – FAB – APP, 2017[36]).
Public R&D expenditure in agriculture grew more slowly than the total national public R&D budget
In 2021, EU Member State governments allocated a total of EUR 3.26 billion (in current prices) to agricultural R&D activities carried out in both government establishments and higher education, business enterprises, private non-profit organisations, as well as abroad. Between 2006 and 2021, these allocations grew at a slower pace than the total national public R&D budget, and half of EU Member States even reduced their investment in agricultural R&D in real terms. Thus, the share of agriculture for the European Union fell from 3.7% to 3.0% (Figure 5.3), placing it behind Australia (8.6%), Canada (7.6%) and Korea (4.6%), but ahead of the United States (1.8%). The importance governments attach to agricultural R&D varied widely across EU Member States, with the highest shares in Bulgaria (17.4%) and Latvia (13.1%) and the lowest in Luxembourg (0.04%) in 2021 (Annex Table 5.A.1).
Figure 5.3. Government budget allocation for R&D in EU agriculture, 2004‑21
Notes: EU27. More information on the EU Member States can be found in Annex Table 5.A.1. Government budget allocation for research and development (GBARD) is a funder-based approach for reporting R&D, which involves identifying all the budget items that may support R&D activities and measuring or estimating their R&D content. It allows linking these budget lines to policy considerations through classification by socio-economic objective. However, it only provides a partial indicator of investment in public agricultural research, since it refers to research funding instruments dedicated specifically to agriculture.
Source: Authors’ calculations based on Eurostat/OECD (2022[37]).
Although agricultural R&D intensity has increased in the European Union, it remains lower than in Japan, Korea, and the United States
Both private and public resources invested in R&D provide some indication of a country’s efforts to innovate. However, due to data limitations, it is often difficult to draw far-reaching conclusions. Box 5.3 discusses issues related to the availability of R&D data.
The “Europe 2020 Strategy” adopted in 2010 set the target of total gross domestic expenditure on R&D (GERD, which covers public and private expenditure on R&D carried out by all residents in a country) at the level of 3% of gross domestic product (GDP) for the whole EU innovation system by 2020 (EC, 2010[38]). Despite having also set country-specific national targets (Rakic, 2021[39]), the EU target was not met. The overall R&D intensity8 for the European Union only increased by 0.5 percentage points between 2006 and 2020, to 2.20%, below the OECD average of 2.68% (Table 5.1; Annex Table 5.A.2 presents R&D intensities for individual EU Member States). Most of this growth can be explained by increased private sector activity.
Table 5.1. R&D expenditure intensities
Notes: 2006, 2020 and 2019, or the nearest available year.
1. Gross domestic expenditure on research and development (GERD) is defined as the total expenditure (current and capital) on R&D carried out by all resident companies, research institutes, university and government laboratories, etc., in a country. It includes R&D funded from abroad, but excludes domestic funds for R&D performed outside the domestic economy. 2. GERD for agricultural and veterinary. 3. Government budget allocation for R&D (GBARD) is a funder-based approach for reporting R&D, which involves identifying all the budget items that may support R&D activities and measuring or estimating their R&D content. It allows linking these budget lines to policy considerations through classification by socio‑economic objectives. 4. GBARD on agriculture covers all R&D aimed at promoting agriculture, forestry, fisheries and foodstuff production, or furthering knowledge on chemical fertilisers, biocides, biological pest control and the mechanisation of agriculture, as well as concerning the impact of agricultural and forestry activities on the environment. This also covers R&D aimed at improving food productivity and technology. 5. Business expenditure on R&D (BERD) is the measure of intramural R&D expenditures within the business enterprise sector (regardless of the sources of R&D funds). 6. BERD on agriculture, forestry and fishing. 7. BERD on manufacture of food products, beverages and tobacco products. 8. The European Union (27 countries) aggregate was estimated for the BERD for the agriculture and food and beverage sectors. 9. The EU27 median only considers countries for which data are available. More information on the R&D intensities in the EU Member States can be found in Annex Table 5.A.2.
Source: Authors’ calculations based on OECD (2022[40]), Eurostat (2021[41]) and USDA ERS (2017[42]) databases.
In the EU agricultural sector, as in many other economies, R&D expenditures are channelled primarily towards universities and research institutions. The median public gross domestic expenditure on R&D for agriculture represented 1.58% of the sector’s value added in 2019, exceeding the intensity of investment from all sources in agricultural R&D in the business sector: BERD constituted 0.11% of agricultural value added.
In 2019, investment in private sector R&D relative to the sector size was lower for agriculture (0.43%) than for the food and beverages industry (0.95%) or the economy as a whole (1.44%). While in the period 2006-19, the intensity of business R&D in both the agricultural and food and beverages sectors increased in the European Union, it lagged behind the more advanced countries in this respect, e.g. Australia (0.69%) for agriculture and the United States for the food processing sector (2.36%; Table 5.1).
Box 5.3. Availability of data on research and development expenditure
Monitoring research and development (R&D) activities requires good-quality data on funding streams. However, despite the existence of international standards and efforts of the OECD and Eurostat, data on agricultural R&D expenditure are often incomplete. Government budget allocation for R&D (GBARD), government expenditure on R&D (GERD) and business expenditure on R&D (BERD) are the most popular indicators. While their data coverage is relatively good at the level of the economy as a whole, there are many gaps and discrepancies at the sectoral level.
GBARD in agriculture is the most timely and widely available indicator. Originating from budgetary sources, however, it includes only expenditure budgeted on agriculture and ignores other general financing mechanisms that may be used for this purpose. The GERD and BERD time series, for which data come from surveys, are often incomplete or have a time lag. GERD for agricultural science often is only available for activities performed by the public sector (government and higher education) and funded from both public and private sources (OECD, 2019[43]).
Results from an OECD survey (2022[5]) show that most participating EU countries collect data on agricultural R&D expenditures or activities (Figure 5.4). However, for more detailed crosscuts, such as investment in agricultural R&D by thematic area, data are often not publicly available. Also, private investment in agri-food R&D is difficult to track as such data are often missing or incomplete in official statistics.
Figure 5.4. Research and innovation data availability in EU Member States
Note: Numbers indicate the number of countries that selected the given answer for the question “Does your country collect the following agricultural/agri-food R&D&I data?”.
Source: OECD (2019[43]; 2022[5]).
5.3.2. Main streams of EU funding
Funding streams and instruments available to support agricultural knowledge and innovation in the European Union are somewhat fragmented
The Multiannual Financial Framework (MFF) forms the backbone of the EU funding system that through various instruments and funds may contribute to the generation of knowledge and innovation in the agricultural sector. Figure 5.5 shows both funds specifically dedicated to agriculture9 (marked in red on the left side), and funding that does not specifically target agriculture, yet may indirectly benefit the sector and promote innovation (depicted on the right side). Horizon Europe and the European Agricultural Fund for Rural Development (EAFRD) constitute two main EU funding sources for agricultural innovation. Further instruments such as LIFE or Erasmus+ can contribute to fostering the development of sustainable agriculture through innovative activities; however, they are discussed to a much lesser extent.
Horizon Europe, and in particular its Cluster 6, is the main EU fund with the potential to foster agricultural research and innovation
Horizon Europe, the European Commission’s key Research and Innovation Framework Programme for 2021-27, is the main EU fund with the potential to foster R&I for sustainable agriculture. Its agriculture-relevant aspects are managed by DG AGRI in Cluster 6 on “Food, Bioeconomy, Natural Resources, Agriculture and Environment”, which is jointly co-managed with the Directorate-General for Research and Innovation and DG ENV. Horizon Europe has a total budget of EUR 95.5 billion over a seven-year programming period (including Euratom and the contributions of Next Generation EU). The European Union decisively augmented its efforts to invest in knowledge and innovation activities, with a 30% higher budget (in real terms) compared to the previous programming, Horizon 2020 (2014‑20).
Horizon Europe is based on three pillars. Under Pillar 1, “Excellent Science”, the European Union aims to promote science across Europe by funding research activities with a budget of EUR 25 billion over the seven-year programming period. This includes measures to facilitate capacity building across researchers as well as the establishment of the European Research Council, a research funding and supporting body. It provides research grants, shares best practices and experiences with national and regional research funding bodies, and connects to other measures under Horizon Europe to leverage synergies in the area of research. It organises its work around different thematic groups (e.g. open science or innovation and relations with industry), adapted to the current needs and requirements of the European Research Area (ERC, 2022[44]). Pillar 2, “Global Challenges and European Industrial Competitiveness”, establishes seven thematic clusters to foster increased R&I activities and innovative solutions in specialised areas with a budget of EUR 53.5 billion. Pillar 3, “Innovative Europe”, with a budget of EUR 13.6 billion, implements activities to boost and better connect innovators in Europe and generally enhance the European innovation landscape. Horizon Europe entails an additional component, “Widening Participation and Strengthening the European Research Area”, that facilitates the whole framework programme (EC, 2022[45]).
Cluster 6 of Pillar 2 “Food, Bioeconomy, Natural Resources, Agriculture and Environment”, with an estimated budget of EUR 9 billion over the programming period, is of particular relevance for R&I in the agri-food sector, although its scope is much wider. One of the seven areas of intervention (area 3) supports activities that aim at fostering knowledge, building capacities and developing novel solutions to promote sustainable land use and a more sustainable, resilient and inclusive agricultural sector (EC, 2019[46]). The cluster also encompasses activities of partnerships, networks and initiatives, such as the “thematic networks”, which aim to compile newly created scientific evidence and best practices and translate them into easily understandable materials for end-users.
Figure 5.5. The EU funding ecosystem to foster sustainable agricultural innovation
Notes: MFF: Multiannual Financial Framework; NGEU: Next Generation EU. This is a stylised, not a fully comprehensive diagram. Funds on the left side are directly dedicated to agriculture, while funds on the right side may have the potential to indirectly benefit agriculture. Additionally, red highlights the relevance for the agricultural sector. The European Space Programme is not included, yet it may benefit agricultural research and innovation through earth observation. The indicated funding amounts refer to the provided EU funding but do not incorporate co-funding from Member States, e.g. for the EARD and EIP-AGRI projects. The sector of performance “agriculture and industry” encompasses farmers, agri-food businesses and extension services.
Source: Authors’ representation and calculations based on EC (2022[47]; 2023[48]).
The multi-actor approach under Horizon work programmes is increasingly becoming an eligibility condition for project proposals. Based on the interactive innovation model, in which end-users are directly involved over the whole course of projects ensuring co-creation and co-ownership of results, the approach aims at making R&I outcomes more demand-driven and relevant to society. While in the 2014-20 period, the multi-actor approach was only used in the agricultural part of the Horizon work programme, its application has been extended to the entire Cluster 6 under Horizon Europe. Already in the first work programme for 2021-22, it is an eligibility criterion for around half of the projects.
Under Pillar 3, the European Innovation Council (EIC) was established, and the European Institute of Innovation and Technology’s (EIT) activities are promoted. The EIC’s goal is to help researchers, innovative companies and start-ups scale up their innovative business capacities and bring their innovations to the market. Additionally, the EIC offers relevant expertise and fosters connections between businesses, corporates, investors and other ecosystem actors (EIC, 2022[49]). To date, the EIC has only initiated a few projects related to agriculture, e.g. the EIC pilot-funded company Infarm that creates sustainable vertical urban farms. The EIT provides funding that can benefit multiple actors in research, business/entrepreneurs and education. It offers, inter alia, opportunities related to education (e.g. an online course on innovation in arable farming), business creation (e.g. via grants, investment support) and innovation projects, offered within their “knowledge and innovation community”. Among these, the most relevant for the agri-food sector is the EIT-Food, an innovation community centred around sustainable food systems of the future. Other EITs, such as Clima or Digital, may also support activities relevant to agriculture.
Horizon Europe’s new mission approach to tackling societal challenges can foster greater synergies and innovation
In line with the recommendations of expert reports and impact assessment and case studies (Mazzucato, 2019[50]; Mazzucato, 2018[51]; LAB – FAB – APP, 2017[36]; Chicot et al., 2018[52]), the European Commission has geared towards a more mission-driven approach to tackling complex societal challenges that cannot be solved by any EU Member State alone and that require breaking disciplinary, sectorial and institutional silos. While this new approach permeates throughout the whole programme, Horizon Europe introduces the so-called EU missions (EC, 2021[3]), flagship initiatives with a strong focus on delivery. They intend to provide a clear direction that is societally relevant; set ambitious but realistically feasible objectives, as well as specific, measurable targets and a time frame for achieving them; spur activity across different scientific disciplines, sectors and actors; and be open to experimenting and exploring various types of bottom-up solutions that can lead to the expected outcomes of the mission (Mazzucato, 2018[51]). Horizon Europe identified five missions from different thematic areas, with the mission “A Soil Deal for Europe” benefiting the agricultural sector (Box 5.4) (EC, 2023[53]). Each mission is planned as a portfolio of actions, such as research projects, policy measures or even legislative initiatives, which should build on co-operation and synergies with other parts of Horizon Europe, including clusters and European Partnerships.
Box 5.4. EU Mission: “A Soil Deal for Europe”
The EU Mission “A Soil Deal for Europe”, with a budget of EUR 320 million for 2021-23, aims to develop concrete solutions for restoring soil functions, and thus help the transition to healthy soils by 2030. The mission is firmly entrenched in the wider policy framework, contributing to the European Union’s key objectives as defined, for example, in the European Green Deal, to assure the highest effectiveness and increase the uptake of soil-related measures. The mission follows the clearly defined target to significantly augment the share of healthy soils to levels that align with the European Green Deal commitments and 2030 targets, compared to the currently prevailing share of 30-40%. To this end, it has the objective to establish a network of 100 living labs and lighthouses1 in rural and urban regions and aims to foster the development of a common European framework for monitoring soils to generate and disseminate knowledge and appropriate solutions for soil health. Living labs are collaborative research and innovation initiatives between multiple actors that experiment in laboratories on the ground (e.g. farms, forest sides or industrial settings) to find solutions to the problem of degrading soils, based on a jointly agreed-upon objective. The multi-actor topics of the Soil Mission are implemented in synergy with and building on the Common Agricultural Policy’s Operational Group projects, many of which are already tackling soil issues. Accordingly, operational groups under the European Innovation Partnership for Agricultural Productivity and Sustainability may profit from the generated knowledge and practical solutions of the future living labs.
1.“Living labs are collaborative initiatives to co-create knowledge and innovations while lighthouses are places for demonstration of solutions and of exemplary achievements” (EC, 2022[54]).
Sources: EU (2022[55]; 2022[54]).
European Agricultural Fund for Rural Development offers support to farmers on innovation-related measures, including knowledge transfer, advice and co-operation
The European Agricultural Fund for Rural Development (EAFRD) is another EU fund that supports knowledge exchange and innovation. It is financed under Pillar 2 of the CAP, with roughly a quarter of the total 2014-20 budget (EC, 2022[56]). Pillar 1 is less innovation-oriented, although some market measures under sectoral programmes may support investment in innovation, e.g. wine.
One of the European Union’s rural development objectives is innovation for sustainable farming. National and regional rural development programmes under the EAFRD for 2014‑20 target agricultural innovation with three main measures (Figure 5.6): 1) knowledge transfer (M1); 2) advice (M2) (Section 5.4); and 3) co-operation (M16), which, among others, supports the setting up and operation of the innovation projects of the EIP-AGRI (Figure 5.1, Figure 5.5, Figure 5.6). Additionally, some other CAP instruments may contribute to fostering knowledge and innovation. For instance, the requirement of a minimum level qualification or training to access some CAP aids, such as farm modernisation investment or support for young farmers, may encourage farmers to upgrade their skills (Chapters 3 and 4).
Figure 5.6. Architecture of CAP 2014-20 implementation with regard to knowledge exchange, innovation and advisory activities
Notes: AKIS: agricultural knowledge and innovation systems; CAP: Common Agricultural Policy; EIP-AGRI: European Innovation Partnership for Agricultural Productivity and Sustainability (Section 5.6); FAS: Farm Advisory System (Section 5.4); M: measure; MS: Member State; OG: operational group. For a discussion on networks, see Section 5.2.
Source: EC et al. (2021[57]).
Agricultural knowledge and innovation activities remain a relatively minor expenditure in rural development funding and are relatively underused by EU Member States
Over the 2014-20 period, the European Union and EU Member States planned to spend jointly EUR 4.45 billion on knowledge and innovation-related measures: EUR 1.3 billion on knowledge transfer (measure M1), EUR 0.7 billion on advice (M2) and EUR 2.4 billion on co-operation (M16)10 (EC, 2023[48]). As of this writing, the uptake of these measures by EU Member States was relatively slow and limited, respectively 45%, 27% and 30%, compared to 67% for the average spending rate for the entire rural development funding stream11 (Figure 5.7).
The share of knowledge- and innovation-related spending in total public expenditure on agricultural support measures under Pillar 2, both EU and national contributions, grew slowly from 0.9% in 2016 to 2.3% in 2021 in the EU27 and was strongly driven by an increase in resources dedicated to co-operation (sevenfold increase for the measure M16). During this period, the average shares for individual Member States ranged from less than 0.5% (Luxembourg, Malta, Romania, Poland, Hungary, Greece, and Bulgaria) to more than 5% (8% for the Netherlands and 5% for Denmark).12
Figure 5.7. Resources planned, decided, and spent on knowledge and innovation measures in the European Union for 2014-20
Notes: RD: Rural development funding of the CAP. Situation as of December 2020.
Source: Authors’ calculations based on EC (2023[48]).
The EU provides funding streams not directly related to agriculture that AKIS may potentially benefit from, but the extent is difficult to quantify
Several additional EU funds, under the co-ordination of different directorates-general, also have the potential to benefit AKIS. Broadly, they are dedicated to general issues such as economic and social development, environmental and climate affairs, or digitalisation across sectors of the economy. The wide range of activities financed under these funding streams, including sustainable investments, green transition measures, skills transfer or improved digital infrastructures, intersect with AKIS. However, the extent to which they can benefit agricultural innovation is often difficult to quantify. Moreover, the agricultural sector is not one of the main beneficiaries of these programmes.
The European Regional Development Fund (ERDF), the EU Programme for Environment and Climate Action (LIFE), the Digital Europe Programme (DIGITAL), Erasmus+, and the Recovery and Resilience Facility are examples of such programmes. The ERDF invests in the social and economic development of regions across the European Union and can contribute to innovation for a sustainable agri‑food sector through smart specialisation strategies. These strategies help to identify R&I priorities in strategic sectors of the country, such as agriculture, to channel knowledge-based investments and co‑operation, including through partnerships such as the S3 Agri-food Partnership on High-tech Farming (EC, 2022[58]). The LIFE programme funds projects with an environmental and climate objective, many of them in or related to the agri-food sector. For instance, the Spanish LIFE Coop2020 project (2014-18) aimed to demonstrate a new sustainable business model for agricultural co-operatives based on the creation of “rural smart grids” and promoting the onsite generation of renewable energy (Coop2020, 2020[59]). DIGITAL funds European digital innovation hubs, initiatives that help companies to boost the development and the adoption of digital solutions. European digital innovation hubs offer services essential for innovation (e.g. financing advice, skills development and training), provide technical expertise and the possibility for experimentation (“test before invest”) (EC, 2022[60]). They are also expected to create links with digital innovation hubs functioning under EIP-AGRI and focused on agriculture (EC, 2021[61]). Erasmus+ is a specific programme to foster education and training across the European Education Area, with some interest in green education. It offers various exchange and co-operation opportunities in higher education, school education and vocational training that benefit the agricultural sector. Finally, the RRF is the European Union’s temporary recovery instrument, put in place in response to the COVID-19 pandemic. Three of its six pillars (green transition, digital transformation, and social and territorial cohesion) entail relevant measures that can contribute to fostering a sustainable agricultural sector (EC, 2022[62]).
5.3.3. Cross-country collaboration on research and innovation
Fostering cross-country co-operation in the field of R&I is a strategic priority for the European Union and a unique role it can play to improve knowledge flows in a larger innovation space. The universal benefits of transnational R&I collaboration for national systems stem from enabling specialisation and from international spillovers. This allows countries with scarce resources and limited research capacity to better consider their local specificities and needs (OECD, 2020[63]). Partnerships are the European Commission’s main mechanisms to stimulate cross-country collaboration.
Research and innovation programming is good at fostering cross-country collaboration
EU Member States are actively involved in international (extra-EU) and transnational (intra-EU) co-operation. According to the OECD survey (OECD, 2022[5]), all 21 surveyed EU countries13 participate in bilateral or multilateral agri-food initiatives in the European Union, and more than three-quarters of them also with third countries. The three main priorities for such collaboration are: 1) sustainable natural resources management (15 countries); 2) animal health and welfare and plant health (11 countries); and 3) adaptation to climate change (11 countries).
EU Member States’ engagement in international research co-operation in the agri-food field is also reflected in the share of scientific publications and patents with at least one foreign co-author or co‑inventor. In the EU27, the share of research outputs co-created with authors from outside Europe grew from 30.1% to 38.9% for publications (between 2006-10 and 2016-20); and from 13.7% to 14.3% for patents (between 2004-08 and 2014-18). Thus, the European Union displayed a higher level of international collaboration than the OECD average (33.8% for publications and 10.7% for patents).
Figure 5.8 illustrates the performance of individual EU Member States in terms of cross-country co‑operation in agri-food R&D, including with partners from both other EU Member States and non-EU countries. In most EU Member States, the share of publications with at least one foreign co-author is above the global and OECD averages (26% and 32%, respectively, for the years 2010-20). This share is highest in Luxembourg (73%), followed by Cyprus (56%), and Austria, Belgium, Denmark, and the Netherlands (all nearly 50%). The share of patents with foreign co-inventors is also relatively high among the EU Member States compared to countries such as China, Japan, Korea, or the United States, where less than 20% of inventions were the result of international co-operation in 2008-18. The leaders among the EU countries are Belgium and Hungary, with a share of around 40% or more.
Figure 5.8. Cross-country co-operation in agri-food R&D
Notes: Values for EU27 exclude intra-EU collaboration, while for individual EU Member States they include co-operation with both other EU Member States and non-EU countries. For the world and OECD aggregates, the values refer to the averages of their members. Individual EU Member States are highlighted in blue, aggregates in black and selected comparison countries in grey. Shares for economies with fewer than 50 patents and/or publications are not shown. Patents data refer to the years 2008-18. Patents filed under the Patent Co-operation Treaty (PCT) by earliest filing date and location of inventors using fractional counts for specialisation and contribution, and using whole counts for collaboration. Agri-food includes patents from IPC classes: A01, A21, A22, A23, A24, B21H 7/00, B21K 19/00, B62C, B65B 25/02, B66C 23/44, C08b, C11, C12, C13, C09K 101/00, E02B 11/00, E04H 5/08, E04H 7/22 and G06Q 50/02. Publications in the field of agricultural and biological science refer to the SCOPUS 2-digit All Science Journals Classification and include the following categories: agronomy and crop science, animal science and zoology, aquatic science, ecology/evolution/behaviour and systematics, food science, forestry, horticulture, insect science, plant science, soil science, and miscellaneous agriculture/biological sciences. Data are based on fractional counts.
Source: Authors’ calculations based on OECD (2022[64]; 2022[65]).
Horizon Europe attempts to rationalise the R&I partnership landscape, but it is too early to assess the results
Partnerships are the European Commission’s main mechanism to foster cross-country collaboration on R&I, the alignment and integration of national R&I strategies, and more effectively channelling investments directed at meeting global challenges and European policy objectives. Partnership programmes bring together a wide range of actors from industry; universities; research organisations; bodies with a public service remit at local, regional, national or international level; or civil society organisations, including foundations and non-governmental organisations and farmers, if relevant. The first partnerships were launched in 2002 as part of the process of creating the European Research Area and were a response to the fragmentation and duplication of research efforts in the European Union. They also seek to ensure synergies across EU and national research agendas, to maximise the impact of public investment directed at meeting global challenges and European policy objectives, as well as to stimulate public and private investment in research activities by sharing risks and ensuring greater investment predictability for their partners. Resource pooling mechanisms from across Europe can help build economies of scale and critical mass that are more challenging for individual countries and thus ensure a strong global presence for European research. Over time, many types of partnerships have been developed to meet the changing needs of European R&I. The complexity of the partnership landscape peaked during Horizon 2020 (2014-20), when nearly 120 partnership initiatives and 8 forms of their implementation co-existed (EC, 2022[66]).
Under Horizon 2020, there have been three main types of mechanisms relevant to agricultural R&I: 1) joint programming initiatives (JPI); 2) European Joint Programme Cofund (EJP Cofund); and 3) European research networks (ERA-NET) (ERA LEARN, 2022[67]). JPIs are intergovernmental partnerships co-funded by the European Commission and Member States to tackle grand societal challenges that cannot be resolved solely at the national level. The main objective of JPI participation is aligning innovation strategies and developing joint calls for research proposals. The JPI on “Agriculture, Food Security and Climate Change” (FACCE-JPI) is of greatest relevance to agricultural research and has recently contributed to the development of new European Partnerships, mainly on agroecology and food systems. EJP Cofunds are designed to support co-ordinated national R&I programmes, co-funded by the European Commission and EU Member States. There are two EJP Cofunds in the area of agriculture: “One Health” (OHEJP) and “Towards climate-smart sustainable management of agricultural soils” (EJP SOIL). The ERA-NET Cofund is a funding instrument designed to support public-public partnerships such as JPIs in the preparation and establishment of networking structures, as well as in the design, implementation, and co-ordination of joint activities.
Horizon Europe aims to simplify the partnership architecture and introduce a more strategic approach with fewer and more impactful partnerships that are better aligned with overarching EU policy goals such as the EGD (EC, 2022[66]). Rationalisation is mostly achieved by merging or discontinuing numerous public-public partnerships, reforming existing partnerships (changing scope and/or partners involved) and launching some new partnerships, including on agroecology and on leveraging data technologies for the monitoring of sustainability performance and policy development (Chapter 2, Section 2.3), to better respond to new priorities. Under the “European Partnerships” umbrella, Horizon Europe establishes three possible forms of partnerships: co-programmed, co-financed and institutionalised.14 The target number of partnerships has been reduced to 49, of which 8 are under Horizon Europe Pillar 2 Cluster 6. However, some partnerships funded under Horizon 2020, that have not yet completed their cycle, continue their activities and may still open calls for proposals.
Agriculture-relevant European Partnerships were brought together under the heading “Cluster 6: Food, bioeconomy, natural resources, agriculture and environment”. Of almost EUR 9 billion of EU funds that go to this cluster, 23% is for partnerships. The EU contribution of EUR 2 billion is expected to be matched with EUR 1 billion committed by the private sector and EUR 0.96 billion by public partners. Four out of eight planned partnerships under Cluster 6 were launched by mid-2022 (“Rescuing Biodiversity to Safeguard Life on Earth”; “A Climate Neutral, Sustainable and Productive Blue Economy”; “A Circular Bio‑based Europe”; and “Water Security for the Planet”), while, in line with the first Strategic Plan 2021‑24, the remaining ones are expected at a later stage (EC, 2022[66]; EC, 2022[68]). These latter partnerships are of particular interest to the agricultural sector (Box 5.5).
Box 5.5. European Partnerships relevant for the agri-food sector
Horizon Europe proposed four European Partnerships of particular relevance to farming and food systems:
The “Accelerating Farming Systems Transition: Agroecology Living Labs and Research Infrastructures” partnership (EC, 2022[69]) aims to accelerate the transition towards sustainable, climate- and ecosystem-friendly farming practices. It will establish a network of living labs and research infrastructure that will provide space for real-life experimentation, help to better understand the agroecological processes and deliver ready-to-adopt practices.
The “Agriculture of Data” partnership (EC, 2022[70]) is to support the development of solutions for the sustainability of agricultural production and strengthen the capacity to monitor and evaluate policies. The partnership will generate EU-wide data sets and information thanks to harnessing the potential of digital technologies combined with Earth observation and other environmental and agricultural data.
The “Animal Health and Welfare” partnership (EC, 2022[71]) aims to facilitate co-operation between relevant actors to develop new knowledge, monitoring and control tools that will strengthen preparedness and bring additional solutions to prevent, detect and respond to priority infectious animal diseases; fight against antimicrobial resistance; and improve animal welfare.
While the European Partnership “Sustainable Food Systems for People, Planet and Climate” (EC, 2022[72]) is less directly linked to primary agricultural production, it seeks to build synergies with the above European Partnerships to accelerate the transition towards healthy and safe diets that are sustainably produced and consumed in resilient food systems. It aims to establish a food system knowledge hub and a network of interdisciplinary and transdisciplinary food system living labs.
The European Union also promotes co-operation with countries from outside its borders
The EU framework programmes for R&I (Horizon Europe and its predecessor, Horizon 2020) are open to researchers and innovators from around the world who are encouraged to team up with EU partners in preparing proposals. Research framework programmes also include targeted initiatives with key partners from non-EU countries. For instance, the African-European R&I partnership on “Food and Nutrition Security and Sustainable Agriculture” was established in 2017 around the global challenge of food security. By June 2020, it channelled a joint investment of over EUR 390 million on priorities encompassing sustainable intensification of agriculture, agriculture and food systems for nutrition, and expansion and improvement of agricultural trade and markets. It financed projects mainly through the ERA-NET Cofund LEAP-Agri and DeSIRA. The EU-China “Food, Agriculture and Biotechnology” Flagship Initiative launched in 2013 is another example of EU collaboration with non-EU countries. By early 2019, the flagship had mobilised over EUR 120 million and organised more than 16 projects addressing priority themes of mutual interest, such as tackling food security, food safety, healthy diets, animal health and sustainable agriculture (EC, 2019[73]). Both initiatives are expected to continue under Horizon Europe (EC, 2019[46]).
The European Commission’s partnership, “Development of Smart Innovation through Research in Agriculture” (DeSIRA), promotes the importance of R&I for accelerating the transition of agri-food systems in low- and middle-income countries. DeSIRA aims to support R&I projects in Africa, Asia, and Latin America; strengthen national research capacities and research governance; and enhance the use of evidence for better R&I policies. Its activities contribute to building science-based solutions of immediate application, including the adaptation of agricultural practices to climate change, the promotion of agroecology and the support of small farmers.
The European Commission also partners with the Global Research Alliance on Agricultural Greenhouse Gases. This initiative brings together over 60 countries from all regions of the world and nearly 30 partner organisations with a common goal of finding ways to grow more food without increasing greenhouse gas (GHG) emissions. The alliance provides a framework for voluntary action to stimulate co‑operation and investment in relevant research activities.
5.3.4. Outputs of R&D investment in agri-food science
The performance of agricultural innovation systems can be monitored by proxy measures such as the number of patents or scientific publications. While these indicators only provide a partial picture of the overall innovation performance, they may shed some light on the profiles of countries in terms of their specialisation in agri-food R&D and their importance in the international arena.
The European Union’s R&D system is relatively specialised in agri-food. In the period 2008-18, 5% of all patents in the European Union were in the agri-food field, well above that of Korea and Japan, but below Australia, Canada, and the United States (Table 5.2). The most specialised in this respect among EU Member States were Denmark and Belgium (above 10%), while the least specialised were the Czech Republic, Sweden, Finland, Austria and Germany (below 4%; see Annex Table 5.A.3). Also, about 5% of scientific publications in the European Union in 2010-20 were related to agriculture and/or biology, a greater portion than in Korea, Japan, and the United States, but lower than in Australia (Table 5.2). Latvia (above 11%), and Romania and Cyprus (below 3%; see Annex Table 5.A.3) had the highest and the lowest shares in the European Union, respectively. The European Union gradually reduced its specialisation in the agri-food field due to the increased dynamics of other fields of science. The share of agri-food patents declined from 5.2% in the 1990s to 5.0% in 2004-08 and 4.9% in 2014‑18, while the share of publications in the field of agricultural and biological science dropped from 5.8% to 5.0% between 2005-10 and 2015‑20 (OECD, 2022[64]; 2022[65]).
Table 5.2. Agriculture and food science R&D outcomes
Agriculture and food science R&D outcomes, 2010-20 (publications) and 2008-18 (patents)
1. Patents filed under the Patent Co-operation Treaty (PCT) by earliest filing date and location of inventors using fractional counts for specialisation and contribution, and whole counts for collaboration.
2. Publications in the field of agricultural and biological science.
3. Top 10% of the world’s most cited publications in the field of the agricultural and biological science.
4. More information on the EU Member States can be found in Annex Table 5.A.3.
Source: Authors’ calculations based on OECD (2022[64]; 2022[65]).
The European Union is a major contributor to global agri-food R&D outcomes. With around 2 500 patents filed per year over the period 2008-18, it accounted for 30% of the world’s total, ahead of the United States and Japan (Table 5.2). The number of patents is not evenly distributed among EU Member States, with France and Germany jointly accounting for more than half of the EU’s contribution (Annex Table 5.A.3). In line with the OECD trend, the EU27 also increased the number of agri-food patents between the 1990s and 2008-18 by over 50%. Nevertheless, due to increased R&D activity in the BRICS15 countries (especially in China), and in Korea, the importance of the European Union on the international stage slightly decreased during this period. On average, over 28 000 agricultural and biological scientific publications were published in the European Union every year between 2010 and 2020, corresponding to almost a quarter of the global total. The United States and China were the next two economies with the highest publishing activity (Table 5.2). Within the European Union, four countries – Germany, Spain, Italy and France – together accounted for half of the EU contribution (Annex Table 5.A.3). Between 2005‑10 and 2015-20, the number of publications in the European Union grew by nearly a third, growth comparable to that of Australia and the United States, but lagging behind developing countries such as China, with more than a threefold increase (OECD, 2022[64]; 2022[65]).
The importance of the European Union’s research results in the international area is further confirmed by the relatively high share of publications in the 10% of the most cited publications in the world. About 12% of all agricultural and biological science publications in the European Union were among the top 10% most cited publications in 2010-20. These shares were particularly high in the Netherlands (18.6%), Denmark (16.5%) and Ireland (16.1%; Annex Table 5.A.3).
5.4. Building the right balance of skills for innovation for sustainable agriculture
There has been a growing concern in many EU Member States and OECD countries over the last two decades of shortages of labour and the key skills needed to ensure the resilient growth, innovation and sustainable development of the agricultural sector. Given that the agricultural workforce generally presents a low skill level, agricultural VET and farm advisory services face several challenges, including providing opportunities for lifelong learning to upskill and reskill the current workforce, strengthening the responsiveness of the agricultural education systems to the sector’s diverse need, and exploiting the roles of advisory services in AKIS as a service provider to farmers and a facilitator of formal and informal education and training programmes.
5.4.1. Skills and knowledge needs
The employment profile in European agriculture is shifting towards a greater demand for highly skilled workers…
According to the European Union Labour Force Survey,16 around 8.4 million people were employed in the agriculture, forestry and fishing sector17 in 2020 (CEDEFOP, 2022[74]). The sector comprises 71% of skilled farm workers, 14% of agricultural labourers, 4% of operators and assemblers, and 10% of other occupation groups.18 The occupational composition of the sector varies greatly from one Member State to another.
Employment in the EU agriculture, forestry and fishing sector is projected to fall by 27% between 2020 and 2030, the highest decline among sectors, according to estimates of the European Centre for the Development of Vocational Training. This projected decline can be attributed to various reasons, including the ageing of the workforce, productivity improvements and expected greater automation, resulting in a reduction in the demand for manual labour (CEDEFOP, 2021[75]; Maucorps et al., 2019[76]). The employment profile in the sector is also expected to change, as the participation of low- and medium-skilled workers will decrease and the share of high-skilled ones will increase. Furthermore, it is estimated that there will be high turnover, with around 6.3 million skilled farm workers leaving the sector and being partially replaced by around 5.7 million new entrants (CEDEFOP, 2021[75]).
…which translates into a need for various new skills and capacities among agricultural workers, including digital skills, environmental management, and entrepreneurship…
The agricultural sector is changing, and with it the skills required. The effects of climate change, new environmental regulations, the availability of new digital technologies and analytical tools, or the emphasis on competitiveness are just a few examples of the challenges and opportunities the sector faces. Increasingly, farmers are being asked to consider environmental and social aspects of their farms alongside productivity and this may require more knowledge or advice that is specialised in these fields. Legal and regulatory knowledge related to both farming practices and working conditions is also required (Rose, 2021[77]). This translates into a change in the type and complexity of farming tasks, and different skills set that might be required of agricultural workers in the future.
…and consequently, for a robust long-term skills agenda for the EU agri-food sector
The broad range of needs outlined above clearly indicates a space for a more sectoral skills strategy that could respond to the social transition towards a green, digital, resilient economy. This is supported by the views on long-term skills needs and knowledge gaps for a sustainable agricultural sector expressed by EU Member States in the OECD survey (Figure 5.9). The majority of the participating countries are aware of the need to further develop skills and knowledge in the use of digital technologies in the sector (Section 5.6). Respondents overwhelmingly highlighted skills needs related to digital technology as a priority concern. Environmental management is the second top concern among Member States. The two needs may also be partially interlinked, as digital may facilitate information to better address environmental constraints, including for precision agriculture, which has the potential to reduce the excessive use of pesticides and reduce GHG emissions from the sector (OECD, 2019[78]). Furthermore, several Member States called for more investment in human capital to increase the number of entrepreneurs and skilled farm managers who could continue farming even in times of uncertainty.
Figure 5.9. Long-term skills needs and knowledge gaps identified in EU Member States’ food and agriculture sector
Notes: Twenty-one responding units provided an answer to this question. Values refer to the number of countries which indicated this option as one of the top 3 most important. See Annex 1.B for more information on the survey.
Source: OECD (2022[5]).
Various researchers and organisations have also been examining the question of what skills are needed to conduct agricultural business. For example, Eurofound (2016[79]) developed a set of task indices, with two main occupations of particular interest (Figure 5.10): skilled farm workers and agricultural labourers. The indices allow for measuring task content (what people do at work) and the methods and tools (how work is organised and done) across jobs in Europe. Autonomy, creativity and resolution, and the ability to gather and evaluate information were identified as the most important skills for skilled farm workers (Figure 5.10, Panel A). These skills are essential to planning, organising and performing farming operations and breeding animals (CEDEFOP, 2021[75]), but were of comparatively less importance for agricultural labourers (Figure 5.10, Panel B). The operation and maintenance of machinery was an important skill for both occupational categories, while the ability to use ICT ranked low. Social skills were relatively less important, especially for agricultural labourers.
Figure 5.10. Important tasks and skills in the agricultural sector
Notes: The importance of tasks and skills is measured on a scale of 0-1, where 0 means least important and 1 means most important. ICT: information and communications technology.
Source: CEDEFOP (2022[80]), based on Eurofound’s European Working Conditions Survey, OECD Survey of Adult Skills PIAAC and the US Occupational Information Network ONET database.
Despite a low score for the importance of ICT use in the agricultural sector in the Eurofound’s task indices, digital skills are now seen as a requirement according to many reports predicting the future of farming (Rose and Chilvers, 2018[81]; OECD, 2019[78]). Farmers will certainly need to understand how to gather and interpret data, and take decisions based on such evidence. Furthermore, to comply with the subsidy conditions, European farmers are requested to store digital evidence, such as information on agricultural practices at the parcel level, and present it to the national and EU agricultural regulators (OECD, 2019[78]; 2015[82]). Although some technologies may operate on a service model, and farm advisors may be available to help farmers interpret the data, basic digital skills are essential, as they help assess the potential benefits of new technologies and understand how to use them (Rose, 2021[77]).
An EIP-AGRI seminar (EIP-AGRI, 2020[83]) on “New Skills for Digital Farming” highlighted the need for cross-cutting skills such as open-mindedness, comprehensive management, communication and collaboration, digital literacy, and advanced digital skills. Communication and collaboration are particularly important in the digital transition of farmers as they do not take place in a vacuum and the ability to build networks with several actors (e.g. IT advisors) is of great importance for digital uptake as well as for the ability to learn and innovate. Moreover, an OECD report (2019[78]) pointed out the crucial role of “soft” skills, such as problem-solving, creative thinking, management and communication skills, in facilitating digital transition of farmers, and thus fully realising their benefits.
While the EU agricultural sector experiences skills imbalances…
Skills imbalances, such as skills mismatches and shortages,19 in the sector can exert a negative impact on overall economic growth, firms and individuals. They can negatively affect economic growth through their effects on increased labour costs, lower labour productivity growth, slower adoption of new technologies and lost production associated with vacancies remaining unfilled (OECD, 2016[84]). Firms experiencing skills shortages may be constrained in their ability to innovate and adopt new technologies, and might face higher hiring costs, while workers with skills mismatches may experience a higher risk of unemployment, lower wages and lower job satisfaction (OECD, 2016[84]).
The OECD Skills for Jobs Database sheds light on whether the demand for a certain type of skills is adequately met, and whether skilled workers occupy positions where their abilities are fully utilised. It provides an overview of relative shortages and surpluses for skills, and measures skills mismatches using qualification mismatch and field-of-study mismatch indicators (OECD, 2017[85]). Figure 5.11, Panel A shows that more than half of EU Member States encounter shortages in communication skills, digital skills, business processes, and training and education20 in the agriculture, forestry and fishing sector.21
Figure 5.11. Skills shortages in the EU agriculture, forestry and fishing sector, 2019
Notes: The skill shortage index for 14 skills types was calculated for the agriculture, forestry and fishing sector of 25 EU Member States. No data were available for Croatia or Malta. Skill types of Medicine Knowledge and Arts and Humanities Knowledge were excluded from the figure due to low consistency with the focal sector. The index is constructed in two steps. First, an occupational shortage index is calculated for each occupation based on five sub-components: 1) wage growth; 2) unemployment growth; 3) hours worked growth; 4) unemployment rate; and 5) change in underqualification. Second, the values of the occupational shortage indexes are used to weight the importance of the skill requirements associated with each occupational group. Information on skill requirements in each occupation is extracted from the Burning Glass Technologies (BGT) data. The scale ranges from -1 to +1, with negative values indicating skills surpluses, while positive values indicate shortages. For Panel A, the number of Member States with the shortages was counted.
Source: OECD (2022[86]).
Figure 5.12. Qualification and field-of-study mismatches in the European Union
* Agriculture sector refers to agriculture, forestry and fishing.
Notes: Qualification mismatch arises when workers have educational attainment that is higher or lower than that required by their job. If their education level is higher than that required by their job, workers are classified as overqualified; if the opposite is true, they are classified as underqualified. Field-of-study mismatch arises when workers are employed in a different field from what they have specialised in. For the field-of-study mismatch, no data are available for Bulgaria, Poland or Slovenia.
Source: OECD (2022[86]).
Digital skills can be understood as a broad concept and covers a wide spectrum of skills ranging from basic digital literacy, i.e. the ability to use office suite software (word processing, spreadsheet and presentation software) to advanced ones, such as skills in data analysis, digital design and marketing, and software and programming. The degree of shortage in digital skills varies among EU Member States, reflecting, inter alia, country-specific employment conditions and skills requirements (Figure 5.11, Panel B). For instance, a high surplus of digital skills in Spain may be partly linked with the high employment share of agricultural labourers who are less likely to use digital technologies as also confirmed by Eurofound task indices (Figure 5.11, Panel B). Conversely, countries with a relatively higher employment share of high-tech occupations (e.g. science and engineering professionals, and ICT professionals) within the agricultural sector, such as the Czech Republic (14.1%) and Finland (9.4%), exhibit digital skills deficits. As highlighted above, farmers need different skills across the spectrum, from digital literacy to soft skills such as communication, to exploit the full benefits of digital technologies. This indicates more potential constraints on adopting new digital technologies in countries where both digital and communication skills are lacking.
The EU agriculture, forestry and fishing sector was also found to experience skills mismatch, i.e. workers have higher or lower skills proficiency than what is required by their job. As seen in Figure 5.12, Panel A, the sector displays the highest rate of overall qualification mismatch among all sectors of the economy, with 42% of workers’ education levels mismatched to their current jobs. The levels of qualification mismatch, however, vary among EU Member States, ranging from 16% in the Czech Republic to 67% in Ireland22 (Figure 5.12, Panel B). Nearly half of Irish workers in the sector are underqualified, with lower than required levels of education, while in Greece the majority of workers are overqualified. The level of overall field-of-study mismatch for the agriculture, forestry and fishing sector was also high. Forty-one per cent of workers in the sector are employed in a field other than in which they are specialised. This places the sector in the fourth position of field-of-study mismatch among all economic sectors. Greece and Romania had the highest rates of field-of-study mismatch (77%), while the majority of workers in Denmark benefit from their specialisations in their workplaces (Figure 5.12, Panel C).
…farmers’ participation in adult training remains low despite the existence of relevant policy measures
“OECD Skills Strategy” country reports, covering several EU countries, highlight several opportunities to reduce skills imbalances.23 They recommend improving information about current and future skills needs; providing opportunities to upskill and reskill the current workforce through VET; and attracting more young skilled workers to the sector. These are consistent with the approaches scoped by the European Skills Agenda and the Pact for Skills for the Agro-Food Ecosystem.
Effectively disseminating information on current and future labour market and skills needs is crucial to address shortages and skills mismatches (OECD, 2017[85]; 2019[87]). The Eurofound task indices can be a good reference for job seekers to get an overview of occupational profiles and skills requirements, even if ICT and social skills for the agricultural sector seem to be underestimated (Zagata and Sutherland, 2015[88]). The Erasmus+ projects of FIELDS (January 2020-December 2023) and I‑Restart (September 2022-August 2026) are aiming to identify the current and future skills needs for sustainability, digitalisation and the bioeconomy in agriculture, and could support the prioritisation for training needs.
Lifelong learning and vocational training, ensuring that the existing agricultural workforce can upgrade their skills, is important to reduce skills imbalances. Much of the vocational education/training tends to focus on farm practices and management. This has been particularly important in helping farmers adapt in a rapidly changing sector and adopt more specialised agricultural technologies. Knowledge transfer measure (M1) of rural development programmes (RDP) for 2014-20 supports VET activities. The total public budget dedicated to the M1 in 2014-20 represents, on average, only 1.1% of the public expenditure planned under the RDP (Beck et al., 2020[89]). Out of 112 RDPs, 101 have programmed the knowledge transfer measure, resulting in 1.22 million farmers, or 31% of CAP beneficiaries, being trained in the period 2014-20.24 Case studies used for their evaluation show that low uptake of training measures is due to lack of interest and opportunity costs of farmers, and demand conflicts among different types of farmers (e.g. demand of small, part-time or less-educated farmers, and demand among younger and more “professional” farmers).
International evidence confirms that adults’ participation in education and training in the agro-food sector is quite low in comparison to other sectors. According to the OECD PIACC survey, only 30% of adult workers from the agro-food sector of OECD countries participated in some form of further education or training over the previous 12 months, compared to over 50% for the entire economy (OECD, 2019[90]). Figure 5.13 shows that the participation ratio is variable among countries: more than 60% of adults participated in Denmark, the Netherlands and Sweden, while the rate was much lower in Greece and Italy. Furthermore, less than 30% of respondents who had not recently undertaken any actions to improve their qualifications expressed interest in participating in any form of further training or education in the future. Such a share was also quite low in the whole economy. This indicates that the agricultural workforce is skewed towards groups that face more barriers to training participation than workers in other sectors. Based on a narrative literature review, Rose (2021[77]) identified 11 barriers to farmers learning new skills, including cost, lack of time to complete/deliver staff training, geographic accessibility, gender inequality and fragmented learning.
Attracting younger highly qualified workers to the agricultural sector is crucial to reduce skills imbalances (Chapter 2, Figure 2.8), as more highly educated and skilled young farmers are more likely to adopt new technologies and innovative farming techniques (Zagata and Sutherland, 2015[88]; Staboulis et al., 2022[91]), hence contributing to making farms more competitive. In some cases, a policy instrument has been used to encourage farmers to gain formal education qualifications in return for support payments. For example, ten EU Member States had included additional qualification criteria for support payments to young farmers (under 40 years old). The Young Farmer Payment is a compulsory scheme for Member States to implement, but individual countries can add their own criteria to it (Chapter 3, Section 3.4). In Ireland, for example, to qualify for the payment, a farmer must have “successfully completed a recognised course of education in agriculture giving rise to an award at Further Education and Teaching Awards Council (FETAC) Level 625 or its equivalent” by a set date (Department of Agriculture, Food and the Marine, 2022[92]). This contributes to 44% of Irish farm managers under 35 years having completed full agricultural training, compared to 22% for the EU average (Table 5.3) (Eurostat, 2018[93]).
Figure 5.13. Participation in adult education and training in the agro-food sector and other industries across countries
Notes: Agro-Food industry includes agriculture, forestry and fishing, manufacturing of food, and manufacturing of beverages. Adult education and training refers to participation in formal or non-formal adult education and training in the 12 months preceding the survey.
Source: OECD (2022[94]).
Table 5.3. Training level of EU farm managers, 2010 to 2016
Notes: Basic agricultural training is any training course completed at a general agricultural college and/or an institution specialising in certain subjects (including horticulture, viticulture, silviculture, pisciculture, veterinary science, agricultural technology and associated subjects); a completed agricultural apprenticeship is regarded as basic training.
Full agricultural training refers to any training course continuing for the equivalent of at least two years’ full-time training after the end of compulsory education and completed at an agricultural college, university or other institute of higher education in agriculture, horticulture, viticulture, silviculture, pisciculture, veterinary science, agricultural technology and associated subjects.
Source: EC (2022[18]).
In addition, the 2014-20 Rural Development Programme’s sub-measure M6.1 (Start-up Aid for Young Farmers) has contributed to increasing young farmers’ participation in training. The measure aims to provide financial aid to young farmers no more than 40 years old who are setting up for the first time or who have already set up an agricultural holding during the five years prior to their first application to the scheme. To be eligible for this sub-measure, most countries require a certain level of education and professional skills. For instance, in Greece, young farmers need to become professional farmers within 18 months of acceding to the sub-measure and have adequate skills or obtain them within 36 months of acceding to the sub-measure (Staboulis et al., 2022[91]). No specialisation is required for those with middle education in agriculture majors or those with a university degree and above. As Table 5.2 shows, although there has been significant progress in the total number of farm managers with full agricultural training (an increase of 2.2 percentage points over 6 years), still less than one farmer in ten had full agricultural training in 2016. Furthermore, 68% of all farmers and 57% of young farmers still had only practical experience that year.
5.4.2. Farm advisory services
Despite the growing importance of the need for farm advice, the relevant instruments remain a marginal expenditure within the overall CAP budget and their uptake is limited
There were two main provisions in the CAP 2014-22 that deal with farm advisory services. The first is the “Farm Advisory System” (FAS), which was an obligation for all Member States to provide advice on cross-compliance requirements. The FAS, operated by designated public advisory organisations and/or selected private organisations competent on cross-compliance in each Member State, aimed at helping farmers to better understand and meet the EU rules for environment, public and animal health, animal welfare, and good agricultural and environmental condition (GAEC). The implementation of a FAS had been made mandatory for all Member States since 2007 to provide access to adequate technical support to help the farmers reach cross-compliance goals. Its scope was enlarged in 2013 to cover new topics such as greening, the Water Framework Directive and integrated pest management. Access to advisory services in the framework of the FAS was open to all farmers, but farmers were free to use it or not. In 14 Member States, the FAS was organised at the national level, while in the remaining countries, it was regionalised (EC, 2022[18]).
The second provision is a non-compulsory measure to financially support the use of FAS (M2) set within the framework of rural development programmes (RDPs) (the CAP Pillar 2). The RDP advice measure in the previous period (2007-13) was exclusively used to support the obligation laid upon Member States to set up the FAS and covered only cross-compliance issues. In the 2014-20 period, only 52 out of 112 RDPs used this option (EC, 2022[18]). Five countries (Cyprus, the Czech Republic, Denmark, Luxembourg, and the Netherlands) and 40 regions (20 in France, 6 in Germany, 6 in Italy, 7 in Spain and 1 in Belgium) did not plan to use the M2 as many of them supported farm advice in a more flexible way through national or regional funds. The obligation to use public procurement for the organisation of FAS in RDPs created a lot of administrative burdens, which delayed and refrained expenditure of the measure for those regions and countries where it was planned.
Despite the increasing importance of support for farm advice, due to the delivery mechanism, it remained a very marginal expenditure within the overall CAP budget, with an average of only 0.2% of the Pillar 2 budget in 2014-20. When the expenditure for advisory services (M2) was planned in 2014, it was positively reflected in the overall initial budget allocation of each Member State (dark blue bars in Figure 5.14). However, the actual budget agreed for M2 (light blue bars in Figure 5.14) and the actual expenditure of most Member States (blue bars in Figure 5.14) were much lower in the later stage, and lower than in the previous CAP period (2007‑13) due to administrative constraints related to the application of strict public procurement procedures (Labarthe and Beck, 2022[95]; Beck et al., 2020[89]). This did not necessarily imply a decrease in public support for farm advice, since some countries and regions chose to use national or regional funds.
Under the CAP 2023-27, Member States have to clarify in their CAP strategic plans how measures on advisory services are integrated into the wider innovation policies and approach to AKIS. While there is no longer any reference to the former separate FAS system, the scope of FAS has been widened, and it must cover economic, environmental and social sustainability issues and offer impartial and independent advice to farmers. In fact, Member States are required to ensure that advisors are appropriately qualified and trained and that they do not have conflicts of interest, by granting financial support only for advisory services that comply with these criteria. This principle is intended to help avoid public funding of advice that may be explicitly biased, e.g. advice offered by private sales representatives of inputs, equipment or machinery (Labarthe and Beck, 2022[95]).
Figure 5.14. Resources planned, decided, and spent on Measure 2 (advisory service) in EU Member States for 2014-20
Notes: Resources planned refer to the preliminary budget for 2014-20 as of 2014. Resources spent refer to actual expenditure as of 31 December 2018. Five countries (Cyprus, the Czech Republic, Denmark, Luxembourg and the Netherlands) did not choose M2 in their rural development programmes.
Source: Beck et al. (2020[89]).
The reach and effectiveness of the advisory measure are unclear due to difficulty in monitoring
Over the past 30 years, there has been a transformation in farm advisory services in countries across Europe with a trend towards privatisation, decentralisation and more demand-led systems (OECD, 2015[82]; Knierim et al., 2017[96]). This change has resulted in pluralistic advisory systems comprising a diverse mix of public, private and farmer-based organisations, with differing objectives, priorities and delivery approaches, and employing advisers with variable skill sets (Birke et al., 2022[97]) (Table 5.4). In many Member States, public organisations are still the key advice providers. Farmer-based organisations, including chambers of agriculture, are also major advisory suppliers in Denmark, France, Portugal and Sweden. In countries such as Italy, the Slovak Republic, and Spain, multiple types of advisory suppliers including public organisations, farmer unions, farmer co-operatives, chambers and private advisory services, interact with farmers at comparable degrees (Birke et al., 2022[97]).
Several studies found that the changing policies and the EU legislative framework encouraged private advisory organisations to flourish in many countries, although they are not always well co-ordinated (Prager et al., 2016[98]; Knierim et al., 2017[96]). Due to the federal system, German and Spanish advisory suppliers are highly diverse among the states and regions as well as in the number and type of organisations directly interacting with farmers (Birke et al., 2022[97]). The main subject of the advice varies depending on the type of advisory supplier. Public organisations support farmers in particular on compliance with regulations and areas of public interest, such as promoting sustainable production (OECD, 2015[82]), while farmer-based organisations and private-commercial organisations cover subjects more directly linked to the farm economy, such as farm management and marketing (Table 5.4).
Table 5.4. Dominant type of advisory service in EU Member States
Notes: Country classification is based on Birke et al. (2022[97]) from the i2connect project and is a simplification of reality, i.e. different types of agricultural advisory services co-exist within one country, sometimes even almost equally. Covered subjects are based on the OECD survey of Member States. They are presented in descending order of importance.
1. In Latvia, 99% of the dominant agricultural advisory service provider, LLKC company, is owned by the state and 1% by the Latvian Farmers’ Federation.
Sources: Authors’ representation based on Birke et al. (2022[97]) and OECD (2022[5]).
Despite recent improvements, the evidence shows that EU-funded farm advice only reaches a small proportion of farmers (Beck et al., 2020[89]). Labarthe et al. (2022[99]) also highlight that the enhanced uptake and provision of services are mostly by farmers that are already engaged with the AKIS and there has been relatively little improvement so far in accessing hard-to-reach farmers. Hard-to-reach farmers for FAS are diverse (Klerkx, 2020[100]), and include smaller scale farmers, female farmers, and farmers at the extremes of the age spectrum (i.e. older and younger) (Prager et al., 2016[98]). Also part-time farmers are hard to reach, as their time for farming activities is more limited. Farm labourers, new entrants (or “career changers”) and late adopters are often overlooked by FAS, and connecting with these groups has a strong potential to increase the economic and social cohesion of European agriculture (Labarthe et al., 2022[99]). To stimulate advice on environmental sustainability, in 2020, the Netherlands established the subsidy scheme Subsidieregeling Agrarische Bedrijfsadvisering en Educatie (SABE) (OECD, 2023[101]). Under this scheme, farmers can apply for a government-funded voucher to finance impartial advice from an independent registered advisor. The advice is requested based on the farmer’s specific needs.
The assessment of the effectiveness of FAS, such as innovation adoption and its linkages to environmental sustainability, is highly needed but very challenging. Several methodological limitations (Herrera et al., 2019[102]) and data issues (Labarthe and Beck, 2022[95]) impede monitoring and comparison with census data or Farm Accountancy Data Network (FADN) (Chapter 3, Section 3.5). As part of the EU-funded FP-7 project “Farm Level Indicators for New Topics in Policy Evaluation” (FLINT), data on the “use of advisory service” was experimentally collected in some EU Member States as one of the social and environmental indicators under the FADN framework (Vrolijk, Poppe and Keszthelyi, 2016[103]), allowing to explore the correlations between contacts with advisory services and a set of farm-level sustainability indicators. However, the results showed no clear linear relationship between the use of advisory services and environmental sustainability (Herrera et al., 2019[102]).
There is no evidence of the effectiveness of skills-building funding activities
Under the transition of farm advisory services, the traditional role of the farm adviser, linking research and practice, has largely been replaced by a range of new players, such as specialist/generalist agronomist, crop consultant, veterinarians, facilitator, research project partner (Wynands et al., 2022[104]; Ingram and Mills, 2019[105]). In addition to the technical guidance provided by farm advisors, there is growing awareness of the need for advisers to have a core set of “soft skills and competencies” to help farmers navigate the challenges facing the sector (Atkinson, 2010[106]). These may include core social skills, trusted rapport, ability to work collaboratively, as well as to manage conflicts (Rose, 2021[77]). Many of those fall within the scope of entrepreneurial skills.
Furthermore, the transition towards digitalisation also brings new responsibilities for advisors and the need to develop new skills (Eastwood et al., 2019[107]; Rose, 2021[77]). Kernecker et al. (2021[108]) argue that because of the rise of smart farming, a range of specialised advisors are going to enter the agricultural sector who are skilled in specific areas, and thus collaboration will be needed among constellations of actors. Indeed, an EU SCAR AKIS report (2019[15]) looking at the future of farm advice in Europe argued that advisors would need to adopt more of a listening and coaching role and be facilitators of knowledge sharing alongside new technologies. Similarly, Ingram and Mills (2019[105]) explored the roles of FAS for soil health management, and highlight that the “soft” skills of facilitators, intermediaries and network builders are important in addition to technical skills with respect to soil health management.
The above discussions also call for better investment in the professional development of advisors. For instance, a US study highlights that a farm advisor’s own perception of weather variability is critical for effective farm advising in on-farm climate change adaptation (Niles et al., 2019[109]). Here, the perception is formed largely based on personal experience, education and training. The 2014-20 Regional Development Programme sub-measure M2.3 provides financial support for training advisors. However, the actual number of advisors trained is not clear since so far it was not obligatory for Member States to plan target numbers. Only nine Member States had reported results by the end of 2019 – Croatia, Estonia, Germany, Ireland, Poland, Portugal, Spain, Sweden, and the United Kingdom – resulting in a total of 6 540 trained advisors in these countries in 2014‑19 (Beck et al., 2020[89]).
5.5. Regulation-innovation interfaces and the protection of intellectual property rights
5.5.1. Regulation-innovation interfaces
Policy makers have long been aware of the effect of regulations on innovation that leads to economic growth and prosperity. Most important among these effects are the deadweight losses that inflexible and poorly designed regulations or heavy regulatory environments may impose. For example, a regulation requiring a specific emissions mitigation technology does not encourage innovation in other approaches, nor does it allow firms to leverage the results of innovation for their own benefit. These lost opportunities are a cost to society. To avoid these losses, policy makers have increasingly turned to more flexible approaches, such as cap-and-trade regulations and performance standards that reward innovations that reduce the cost of compliance. These approaches allow firms to innovate and adjust their operations, minimising the cost of regulation to society. Command and control regulations are much maligned but are often the best choice when other options are impractical and important values or substantial risks are concerned. Economists often prefer market-based approaches, but these require that relevant markets exist or can be created, a difficult task for conserving biodiversity for example.
This makes defining a relationship between regulation and innovation a complex task, as both regulation and innovation encompass a broad range of approaches and interactions depending on circumstances. Regulation is innovation-pushing when it forces stakeholders to adopt a new process and develop alternative products (Pelkmans and Renda, 2014[110]). Regulation can also be innovation-pushing when it creates a new competition framework and stimulates the creation of new markets. Innovation can be a tool for firms to accomplish environmental regulatory objectives (Ashford and Heaton, 1983[111]). It is fair to say that poorly designed regulations can certainly discourage innovation or distort it into directions that do not respond to economic and environmental needs. Well-designed regulations, on the other hand, can encourage beneficial innovations by establishing incentives to invest in R&D, internalising and helping to respond to environmental externalities, helping new products to succeed in the marketplace, encouraging the sharing of technology, promoting public-private co-operation or many other ways.
EU regulations such as REACH and the Water Framework Directive may have spurred innovation as measured by the number of patent applications…
A burst of innovation can follow the adoption of stringent regulations or even bans on certain substances or products (OECD, 1996[112]). For instance, Tuncak (2013[113]) found a noticeable increase in patents (a common proxy for innovation) following the promulgation of the Regulation concerning Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH).26 REACH replaces the old principle of presumption of safety of existing chemicals with a mechanism under which the safety of chemicals must be demonstrated prior to their entry to the market. This approach is a major driver of innovation that has led to the commercialisation of more environmentally friendly chemicals (Centre for Strategy and Evaluation Services, 2012[114]). The Water Framework Directive (WFD) follows a very different approach compared to REACH. It mandates river basin management planning and obtaining good status for water bodies by a certain date, along with a regular cycle of reporting and evaluation.27 The WFD seems to have also led to considerable growth in patent applications concerning water-related goods (Peter, Doranova and van der Veer, 2014[115]). However, this correlation over time does not mean causality nor a direct impact of patents on innovation adoption.
Sometimes just the prospect of regulation is enough to stoke innovation. Stakeholders will often pursue new innovations to proactively address issues to stave off potential regulations or get ahead of upcoming ones. The anticipation of future strict regulation can accelerate the development of new solutions; two examples outside the agricultural sector are substitutes replacing asbestos or phosphate detergents (Ashford and Heaton, 1983[111]) and energy efficiency labels before mandatory energy limits were set (Pelkmans and Renda, 2014[110]).
…but the application of the precautionary principle in the European Union extends the period to approve new products and may hamper innovation such as in certain biotechnologies
The future of EU agriculture increasingly depends on innovation-driven total factor productivity growth. Precision farming, digital tools, biotechnology and many other innovations are important ways to increase agricultural productivity while addressing sustainability problems and achieving the objectives of the EGD. Ensuring that the EU approach to regulation does not limit the prospects of the sector is a key concern. There is a large body of practice designed to ensure that EU regulations are well designed and appropriate. This is in the form of the Better Regulation Guidelines (EC, 2021[116]) and significant regulatory assessment requirements, among other things (Regulatory Scrutiny Board of the European Commission, 2020[117]). The European Union has developed a Strategic Foresight tool as part of its better regulations toolbox (EC, 2021[118]). This tool encourages regulators to pay attention, among others, to megatrends that are likely to have a significant long-term influence. One of these identified megatrends is continued climate change and environmental degradation.
The precautionary principle is a central feature of EU law. According to this principle, decision makers are to adopt precautionary measures where there is uncertainty about a potential adverse impact on the environment or human health (EPRS, 2015[119]). EU policy on genetically modified varieties, for example, derives from this precautionary principle and has been controversial. Regulatory barriers present the main obstacle to the deployment of new breeding techniques and genetically modified varieties (EASAC, 2020[120]).
The EU regulatory framework applies the same approval procedures for gene-edited crops as for genetically modified organisms (GMO) products.28 They must undergo a risk assessment and lengthy approval process to be authorised to enter the market.29 This can take five years or more to complete (Garcia-Alonso et al., 2022[121]). This may generate uncertainty and discourage companies from investing in related R&D or compels them to move those research activities outside the European Union. Moreover, the EU regulatory approach to gene-edited products may negatively affect the development of these products in other countries, especially developing countries that adapt their export strategies to match EU market requirements.
5.5.2. Protection of intellectual property rights
Although the European Union has some common frameworks and supranational institutions governing the protection of intellectual property rights (IPRs), each EU Member State has its own national intellectual property protection system. This explains the heterogeneity of levels of the World Economic Forum’s patent protection index (Figure 5.15). In 2019, the scores ranged between 3.7 in Bulgaria and 6.5 in Finland, while the average for the European Union was 5.0.
Figure 5.15. Intellectual property protection index across EU Member States, 2019
Note: EU27 is the simple average of member countries’ indices.
Source: WEF (2019[122]).
The European Patent Office (EPO) acts as an executive body that provides a single patent grant procedure, but not a single patent from the enforcement point of view. Hence, a patent granted by the EPO is not a single or unitary EU patent or uniformly recognised Europe-wide patent, but a bundle of national patents. Patents granted by the EPO can, however, be challenged centrally at the EPO via opposition proceedings.
The European Union protects intellectual propriety rights related to agriculture through national plant variety protection systems and the Community Plant Variety Rights system, which is valid throughout the European Union
Plant breeding innovations and plant variety protection are relevant components of agriculture and have significant impacts on global health, agricultural systems, food security, biodiversity and the environment. Regulating and providing IPRs to protect new seeds is a challenging task. Seeds are an essential start of any crop production; a very important component of agricultural livelihoods in food, ornamental and industrial value chains; of local and global food security; and a determinant of sustainability. Therefore, seeds have become subject to an increasing and more complex number of regulations pursuing different policy objectives (Louwaars and De Jonge, 2021[123]).
EU Member States have national IPR systems protecting their plant varieties and agricultural-related innovations in place. However, these nationally defined systems are based on certain common standards defined by international conventions, such as the International Union for the Protection of New Varieties of Plants (UPOV) and the Agreement on Trade-Related Aspects of Intellectual Property Rights, which allows comparisons between them.
Globally, IPR systems have become more homogeneous and their strength has been increasing, in particular, since the signing of the Agreement on Trade-Related Aspects of Intellectual Property Rights together with the creation of the World Trade Organization (WTO) in 1994.30 As shown in Figure 5.16, departing from relatively heterogeneous levels in the mid-1990s, IPR systems in agriculture strengthened and harmonised over the next two decades. Notably, in all European countries intellectual property protection increased and reached much greater homogeneity by 2018.
Figure 5.16. Index of legal intellectual property rights protection for plant varieties across EU Member States, 1995 and 2018
Notes: CPVO: Community Plant Variety Office. EU27 is the simple average of member countries’ indices, which are built using national legislation.
Source: Campi and Nuvolari (2021[124]). Data are available at www.openicpsr.org/openicpsr/project/121001/version/V1/view.
Interestingly, there exists one supranational organisation ruling on plant variety protection in the European Union. The Community Plant Variety Office (CPVO) was established by EU Council Regulation 2100/94 in 1994 and became operational as of April 1995. The Community Plant Variety Rights (CPVRs) system was created as an independent protection scheme for new plant varieties with a unitary effect throughout the European Union. It is based on the Union for the Protection of New Varieties of Plants 1991 Act, and implemented by the CPVO.
The CPVO grants CPVRs, a type of “plant breeder’s rights” (PBRs), which often refer to the types of IPRs granted by national-level authorities. Both CPVRs and national-level PBRs provide the breeder of a new variety of plants exclusive control over associated propagating and harvested material for a certain number of years. The CPVR is legally valid throughout the entire European Union, which provides exclusive exploitation rights for a plant variety, in all EU Member States through a single application to the CPVO (Würtenberger et al., 2021[125]). This makes the Community system for protecting new varieties very attractive.
However, the CPVRs system is not intended to substitute or harmonise the national laws regarding plant variety protection in EU Member States, but rather to exist alongside them as an alternative. Even after the introduction of the CPVO, individual EU countries retain their ability to grant PBRs (which are valid only within their own borders). The requirements for granting a CPVR directly follow those stipulated by the UPOV 1991 Convention for all types of PBRs. These include requirements for the “distinctness, uniformity and stability”, novelty, and denomination of plant varieties (Theobald, 2020[126]).
When the CPVO was created in 1995, average protection among the EU Member States was 1.6, which increased to 3.8 in 2018. Similarly, the index score for the protection of the CPVO also increased and, in 2018, the breadth of the protection offered by the CPVO was similar to that of most individual countries in the European Union (Figure 5.16). Moreover, the duration of a CPVR is comparable to that of PBRs in individual EU Member States.
Since the creation of the CPVO, the use of national offices for the protection of agricultural-related IPRs has decreased
Since 1995, there has been a shift of IPR applications from national offices to CPVO (Figure 5.17). Although there are differences depending on the country, in most cases, applications at national offices have been decreasing, particularly, those made by non-residents, while CPVR applications from both EU Members and from other countries have followed increasing trends.
The CPVO aims to create incentives for innovation and investment in new plant varieties. Supporting its stakeholders in accessing, using and exploiting the IPR system for the protection of plant varieties based on a cost-efficiency approach remains an important challenge for the CPVO. Working together with its stakeholders and the network of examination offices, EU agencies and other IP players, the CPVO has promoted the sharing of information and expertise and has helped implement EU policies more efficiently, responding to particular needs identified by the EU institutions and Member States. The CPVO fosters the highest technical harmonisation of practices and legal certainty on a high-quality level, aiming to ensure reliable and defendable decisions on plant variety rights in the European Union. This remains a challenge for the CPVO that will require even better co-ordination between all players, both at the EU level and internationally, to address the needs of the stakeholders (CPVO, 2017[127]).
Figure 5.17. Number of applications for plant breeder’s rights and Community Plant Variety Rights by EU residents and non-residents, 1980 to 2018
Notes: PBRs: plant breeder’s rights (applications at EU national offices); CPVRs: Community Plant Variety Rights (applications at the Community Plant Variety Office [CPVO]).
Residents and non-residents at European Union national offices consider the sum of residents and non-residents in the corresponding individual national offices. For the CPVO, residents refer to EU members while non-residents refer to non-EU members, considering the year of accession for each country. For the period of analysis, the European Union includes the United Kingdom.
Source: Authors’ calculations based on data from the UPOV PLUTO: Plant Variety Database, https://www.upov.int/pluto/en; CPVO Plant Varieties Database, https://cpvoextranet.cpvo.europa.eu/mypvr/#!/en/publicsearch.
5.6. Farmer-led innovation and adoption of agricultural innovation
5.6.1. Farmer-led co-innovation
The EIP-AGRI initiative is the main instrument put in place by the European Commission to strengthen the AKIS and close the gap between research and farming practice (EC, 2012[128]).31 It was launched in 2012 to promote multi-actor innovation through different types of projects (Figure 5.18). The first are operational groups’ innovation projects, supported under the EU RDPs (RDP Pillar 2 of the CAP), which function mostly within a country or a region; the second are multi-actor research projects and thematic networks, funded by the Horizon programme, which operate at the transnational level and involve partners from at least three countries.
The EIP-AGRI is based on the principles of the interactive innovation model. The so-called EIP Operational Group (OGs) were conceived to tackle practical problems or explore emerging opportunities that may lead to innovative solutions; hence, their composition is tailored to the purpose of the individual projects. For instance, innovation brokers and other advisors are to help actors, such as farmers and researchers, to set up OGs and disseminate and share relevant information.
The actors involved together form the EU-wide EIP network, which was integrated into the CAP networks under the CAP 2023-27 (Section 5.2). EIP innovation support services facilitate activities at the EU, national, regional and local levels by encouraging the establishment of OGs and communicating their results. The EIP web database with information from OGs and Horizon Multi-Actor Projects acts as an EU repository for projects with practice impact and as a one-stop shop for practical knowledge in agriculture (Coffey, 2016[129]).
Figure 5.18. European Innovation Partnership for Agricultural Productivity and Sustainability
Notes: EIP: European Innovation Partnership. Operational Groups (OGs) are composed of farmers, advisers, researchers, business, non-governmental organisations, etc.
Source: Authors’ representation based on Van Oost (2021[130]).
The rural development co-operation measure (M16) played a key role in implementing the EIP‑AGRI. Support could be given both for the establishment and operation of OGs and for the implementation of their projects. This support could be combined with support under other measures, such as training, advice, investment aids and producer groups. RDPs could fund such bottom-up innovation projects, with up to a 100% support rate and 80% EU co-funding.
The EIP-AGRI is an important policy tool, but its effectiveness has not yet been fully evaluated
The implementation of the EIP-AGRI at the national level differs substantially. It has been widely programmed, with up to 3 200 OGs planned by the end of the 2014-20 programming period (Coffey, 2016[129]). By the end of 2022, 2 400 OGs were reporting on their operation or had accomplished their activities and calls were still being launched. Most of the OGs are located in Italy, Spain, the Netherlands and Germany, together accounting for about half of all OGs (EIP-AGRI, 2023[131]). Furthermore, under Horizon 2020, more than 190 multi-actor projects, worth EUR 1 billion, were implemented (Van Oost, 2021[132]).
Plant production and horticulture, as well as the competitiveness and diversification of farming/forestry, are two thematic areas most often explored in OGs’ projects (EIP-AGRI, 2020[133]). In total, already about 60% of the OGs worked on climate-environment themes, even before the launch of the EGD. OGs can also provide space for policy learning. For instance, in Ireland, they have been used for testing new CAP measures aimed at improving agri-environmental performance (Conway, 2020[134]). Specifically, two themed projects – the Hen Harrier Project and the Fresh Water Pearl Mussels Project – focused on the delivery of biodiversity and habitat protection by combining a results-based approach (rewarding farmers for agri-environmental improvements) with training and advice.
So far, there is no single comprehensive assessment of the functioning of the OGs across Europe. However, some conclusions can be drawn from early assessments of this policy tool and case studies, as well as from the information that OGs provide to the Commission. The distinctive bottom-up approach of the EIP-AGRI was well appreciated by stakeholders, as it allows farmers to take the leading role in the projects and strengthen their co-ownership of innovative solutions (Coffey, 2016[129]). Two barriers were also identified: concerns about the perceived administrative burden and the lack of advance funding, which is particularly relevant for smaller businesses. These two issues are expected to be addressed in the new CAP 2023-27.
The cross-border elements, multi-actor projects and thematic networks under the Horizon programme were perceived as important to facilitate the exchange of expertise, dissemination of results and awareness-building among farmers about OGs’ projects. However, Zezza (2017[135]) pointed out potential problems with disseminating project outputs and results to the great majority of farmers, who are not OG members. Also, the Italian case study (Giarè and Vagnozzi, 2021[136]) highlighted the need for effective communication and dissemination of results, as well as the active engagement of advisors and training experts. Furthermore, the SCAR AKIS Strategic Working Group warned that despite the substantial amount of knowledge available, it remains fragmented across Europe and is still insufficiently applied in practice (EU SCAR AKIS, 2019[15]). As described in Section 5.2, the more strategic approach to AKIS under the CAP 2023-27 aims to respond to these concerns by fostering the functioning of national AKIS.
5.6.2. Adoption of innovation on farms
The decision about innovation uptake can be described as a “process through which an individual (or other decision-making unit) passes from first knowledge of an innovation to forming an attitude toward the innovation, to a decision to adopt or reject, to implementation of the new idea, and to confirmation of this decision” (Rogers, 2003[137]). Multiple socio-economic factors, such as features of farm business and personal characteristics of farmers, the attitude of decision makers on the farm, as well as their embedment in social networks, strongly impact farmers’ decision regarding the uptake of innovation. Therefore, policy incentives can stimulate the adoption of innovations by facilitating the different stages of innovation-decision.
Financial support may provide additional resources for the innovation uptake on farms, but it currently does not sufficiently target low-level adopters or non-adopters
Farm characteristics such as size and income may constitute an economic barrier to adoption innovation, as found by Barnes et al. (2019[138]) in a study on the uptake of precision agricultural technologies (PATs) on arable crop farms in Belgium, Germany, Greece, the Netherlands, and the United Kingdom. Sauer (2017[139]) identified own product- and process-related development activities, farm size, the age of the farm operator as well as confidence in business and sector developments as farm characteristics decisive for the magnitude and success of innovations in the context of the Dutch dairy farms. While the impact of farm size on productivity and sustainability is debated in the scientific literature, larger farms have been shown to be more innovative than smaller ones. They have more potential to adopt scale-dependent innovation, such as GPS-equipped precision agriculture technologies that optimise input use. Compared to smallholders, larger operations also have an advantage in access to knowledge, due to better human and financial opportunities. However, this factor appears to be less important for sustainability (OECD, 2019[43]).
Investments are crucial for modernising agriculture and improving sustainability outcomes. In line with the findings of Barnes et al. (2019[138]), decoupled income support payments under the CAP may theoretically provide an indirect incentive to farmers to adopt new technologies, as more stable income may allow for greater risk taking (Détang-Dessendre et al., 2018[140]). However, over the past two decades, total CAP support has been reduced and is predicted to follow this trend (Chapter 3). As a result, farmers with larger operations, mostly driven by profit, will be the primary users of precision agriculture tools, while smaller farms will likely be low-level adopters or non-adopters. Reducing subsidies may thus remove the incentive for low-level adopters and widen inequalities. Compared to direct payments, having a direct impact on current income but also potentially creating dependence on this support, investment support can contribute to the long-term viability of the farms. Also, further investments in enabling infrastructure, e.g. broadband (see Chapter 2, Section 2.3) and data solutions required by PATs, can send a strong signal to the farming community, trigger expectations of positive economic returns and facilitate the uptake of new technologies.
Farm advisory services should direct their efforts to inform farmers about new technologies and practices for sustainable agriculture
Attitudinal differences can also play a role in the decision to adopt innovative practices and technologies. Farmers who have built a positive belief towards the economic return of the technology are more likely to adopt it (Barnes et al., 2019[138]). Under the CAP 2023-27, in their CSPs, EU Member States are expected to support sustainable farming practices, such as organic farming, integrated pest management, agro-ecological measures, animal welfare, “high nature value” farming or carbon farming, and improved nutrient management (EC, 2021[141]) (see also Chapters 3 and 4). Therefore, the discussion around sustainability management standards is both timely and relevant. Hannus and Sauer (2021[142]) studied the decision-making process for adopting comprehensive farm sustainability management standards on a sample of German farmers. They found that the absence of wider adoption of sustainability standards can be explained by a lack of clarity about the relative advantages of applying sustainability standards, thus implying insufficient communication of the possible benefits, such as saving time or resources or improving their farm image. They also analysed the design of such standards and identified six key elements: 1) consideration of the desire for higher product prices; 2) existence of data for sustainability assessment; 3) technical support for users; 4) ease of integration of new standards into current processes and routines; 5) limited level of complexity; and 6) promotion of benefits.
Data-intensive technologies require additional investments in knowledge transfers to close the gap between training provided by industry and users’ optimal ability to run machines (Barnes et al., 2019[138]). Moreover, based on the sample of Italian farms, Vecchio et al. (2020[143]) found that higher exposure to information about precision farming tools, e.g. through magazines, journals, training courses, helps overcome perceived complexity and associated barriers to adoption. Also, better-educated farmers revealed a higher propensity to adopt new technologies compared to less educated ones (Vecchio et al., 2020[143]). Additionally, the inability to independently assess the rate of return on investment in technology creates disincentives for farmers. Communication activities around PATs’ effects specific to different regions and contexts can help overcome uncertainty, foster the farmer’s belief in a positive return and support the technology purchase decision (Barnes et al., 2019[138]). Due to attitudinal and resource constraints, the public sector has an important role to play in fostering farmers’ awareness of new technologies and practices deemed to enhance sustainability, helping them upskill (Section 5.4) and thus stimulating PAT adoption. FAS are fundamental to this process, highlighting the need for well-informed, professional and independent advisors (Section 5.4).
Demonstration farms provide an opportunity to influence farmers’ decision on adopting new practices and tools thanks to peer learning
In addition to economic and personal considerations, farmers’ decision to innovate is strongly influenced by embedment in social networks. Change-promoting actors, including buyers, input providers, local authorities, farmers’ groups and others, can foster openness to innovation and limit barriers to innovation uptake (Fieldsend et al., 2021[144]). Farmers may build micro-AKIS where they interact only with selected AKIS actors, excluding others, e.g. educational actors (Fieldsend, 2020[145]). In this context, friends and family are a vital source of information and knowledge, especially for family farmers. Moreover, farmers are likely to be the most influenced by exposure to successful agricultural methods used by their peers (Fieldsend, 2020[145]), potentially including sustainable farming practices. Hence, fostering peer-to-peer learning, e.g. through demonstration farms’ activities, is crucial to effective knowledge transfer towards farmers, in particular those less involved in innovation co-creation activities.
Demonstration farms are considered to be an effective way of providing farmers with opportunities to exchange knowledge with their peers and experts, jointly solve problems and gain experience through hands-on activities (Ingram et al., 2018[146]). Farm Demo Hub, launched in 2018, aims to help connect farmers carrying out demonstration activities with those interested in participating by providing an online platform, resources and tools. The AgriDemo-F2F and PLAID projects, funded under Horizon 2020, collaborated on the development of a European-wide georeferenced inventory of demonstration farms. At the end of 2022, the inventory contained over 1 500 entries, with additional information on, among others, farm types, demonstration topics and available languages. The AgriDemo-F2F project carried out an in-depth comparative analysis to deepen understanding of farm demonstration activities in Europe. A synthesis of 35 case studies, representing a variety of demonstration approaches and activities, identified seven categories of “best practices” for the organisation of such events: 1) setting clear objectives linked to the target group; 2) co-ordination at the national level combined with the provision of an enabling environment and long-term funding opportunities; 3) leveraging on existing structures and networks; 4) recognising it as the farmers’ learning pathways and encouraging their involvement in the development of programmes and topics; 5) presence of a trustworthy host who is an expert in his field and has demonstration and facilitation skills; 6) attention to group structure and dynamics, e.g. a smaller group increases active participation and discussion; and 7) post-event evaluation of achievement of primary objectives, but also softer outcomes like peer-to-peer learning or empowerment (Marchand et al., 2019[147]).
5.6.3. Digitalisation in the agricultural sector
Evidence gathered by the OECD (2019[43]) points to a wide range of productivity-enhancing innovations being adopted in the reviewed countries. The innovations encompass genetic improvements of seeds and animal breeds; input-saving technologies such as no-till cropping, milking robots, more energy-efficient buildings that also allow for higher animal welfare; technologies and practices for precision agriculture and better risk management, e.g. irrigation systems, GPS-assisted tractors, satellite image, drones; and changes in production management and marketing practices. Digitisation may enable or create favourable conditions for some of them.32
The twin digital and green transition stands high on the agenda of the European Union, including in the field of agriculture and rural areas, as it is well reflected in multiple strategic documents under the headline ambitions “The European Green Deal” and “A Europe Fit for the Digital Age” (Chapters 1 and 2). The CAP 2023-27 also recognises the “enabling potential” of digital technologies to contribute to meeting its objectives. Hence, as part of the CSPs, EU Member States have been asked to develop digital strategies, i.e. a strategic approach to digitalising agriculture and rural areas (van Oost, 2022[148]). To this end, countries can make use of a wide range of CAP measures, including those dedicated to training, advice and investments, precision farming under eco-schemes, as well as collaboration (LEADER and EIP-AGRI). Ideally, the implemented measures will share a degree of complementarity with other EU or national instruments.
Digitalisation offers the potential to help address the productivity, sustainability and resilience challenges…
The ongoing digital transformation provides multiple opportunities for agriculture and food systems. Digital tools can be used, among others, to create value added for farmers, encourage consumers to buy healthy and nutritious foods produced through sustainable farming practices (Baragwanath, 2021[149]), facilitate trade (OECD, 2021[150]), and improve policy making (OECD, 2019[78]). The COVID-19 crisis has further reinforced the demand for digital solutions. For instance, as reported in the Agriculture Policy Monitoring and Evaluation 2021 (OECD, 2021[151]), many countries have decided to step up their efforts towards measures with the potential to improve market functioning and, thus, the resilience of the sector.
Focusing in particular on farmers and their businesses, digitalisation may foster wider use of communication platforms and online courses, precision agricultural technologies, Internet of Things33 or big data for day-to-day management decisions. Thus, if steered in the right direction, digital technologies can be beneficial for the sector: facilitating the building of human capacity in the sector (Bellon-Maurel et al., 2022[152]; Détang-Dessendre et al., 2018[140]) and making farm operations more profitable, efficient, resilient, safer and environmentally friendly (McFadden et al., 2022[153]; ADB, 2021[154]; OECD, 2019[78]). Digitalisation, and the changes it causes, also bring with it certain barriers (and risks), such as high investment and maintenance costs (discussed above); underdeveloped digital infrastructure; lack of relevant skills among farmers; non-compatibility with farmers’ needs and societal demands; lack of trust from farmers (Bellon-Maurel et al., 2022[152]; Détang-Dessendre et al., 2022[155]; McFadden et al., 2022[153]; McFadden, Casalini and Antón, 2022[156]). It is, therefore, vital to take these challenges into account when guiding and incentivising the research, development, and deployment of digital technology.
…but it requires further investment in ICT infrastructure and developing skills among future users to enable wider adoption
Technological infrastructure and human capital are prerequisites for the digitalisation of the agricultural sector (Brunori et al., 2021[157]), as their shortcomings may exacerbate inequalities and exclude certain groups of farmers. Despite the increasing access to broadband Internet in European households and the narrowing urban-rural divide (Chapter 2, Section 2.3), the lack of reliable, affordable and widely available high-speed Internet continues to be a barrier to the adoption of digital solutions on farms. In an OECD survey of EU Member States (OECD, 2022[5]), the availability and performance of the digital infrastructure for the agricultural sector were assessed as “good” or “very good” by less than half of participating countries, compared to 70% for the country as a whole. Hence, there is a clear need to step up efforts to increase the connectivity of remote areas and ensure equal access to digital technologies.
Digital technologies have the potential to strengthen the inclusion and upskilling of farmers, but also to foster their exclusion. As discussed in Section 5.4, competences needed to take advantage of digital technologies need to be strengthened in the agricultural sector. The current average status of digital skills and literacy among farmers was evaluated as “good” or “very good” in only 6 out of 21 European countries participating in the survey (OECD, 2022[5]). FAS have an important role to play in upskilling farmers in the use of digital technologies. However, they often need to first gain the relevant expertise themselves, and currently seem not to fully leverage the use of ICTs. Among the respondents to the survey (OECD, 2022[5]), only 1 out of 19 considered the use of ICTs for training, and 6 out of 19 considered the inclusion of remote farmers as representative of the practices of their local FAS. In this context, the current CAP measures dedicated to knowledge transfer and advice could be further strengthened and guided in this direction. Synergies should also be pursued with the Digital Europe Programme (DIGITAL), which provides funding to projects in key areas such as advanced digital skills, and ensures a wide use of digital technologies across the economy and society (EC, 2020[158]).
Digital technologies must help meet farmers’ needs and societal demands…
Digitalisation should be seen as “the means to an end rather than the end in itself” (Brunori et al., 2021[157]). Going even further, digital technology must help answer both the needs of farmers and the societal demand for environmentally sustainable agriculture. The literature points to the potential for a “rebound effect”, where changes in producer behaviour might offset resource saving from technical improvements, thus leading to a further increase in environmental pressures, e.g. greater water use (Paul et al., 2019[159]). The expected collaboration between the regional European digital innovation hubs dedicated to digital innovation in the agri-food sector, introduced under DIGITAL (EC, 2021[160]), and the EIP-AGRI Operational Groups has the potential to find promising solutions through experimentation and to provide directionality to the development of digital technologies for sustainable farming.
…while the general policy environment has a role to play in fostering farmers’ trust in such technologies
Finally, farmers’ lack of trust in digital technologies is another barrier. Four main issues can explain it: data ownership and confidentiality concerns; misalignment of incentives for sellers and buyers of digital technologies combined with an imbalance of power; the perceived high complexity of digital technologies (“black box”); and the lack of standards for comparing and certifying the functionalities of digital technologies (McFadden, Casalini and Antón, 2022[156]). To encourage farmers to adopt digital technologies, McFadden, Casalini and Antón (2022[156]) recommend governments encourage companies to separate the sales of problem assessment from the sales of solutions; strengthen public sector extension services and enhance farmers’ learning about digital agriculture; facilitate the development of risk-sharing arrangements between technology providers and farmers; and explore ways to promote the standardisation of evaluation and certification of digital agricultural technologies. However, trust-related policies need to be tailored to farmers’ specific concerns, which need to be further explored.
The effectiveness of policies targeting greater digitalisation in the agricultural sector cannot be properly assessed without adequate data. McFadden et al. (2022[153]) point to a lack of evidence on the uptake of digital technologies across OECD countries in animal husbandry and speciality crop farms, contrary to crop farms where the widespread adoption is more documented. Cross-country comparisons are further hampered by differences in the construction of indicators (per area or per farm). To fill this gap, the European Commission intends to harmonise the collection of data on the use of precision technologies on crops and livestock farms by introducing new modules to the 2023 Integrated Farm Survey.34
5.7. Reflections on transformative approaches to policies
The previous sections depicted the complexity of actors, incentives, as well as selected elements of the environment that can enable the generation and uptake of innovation for sustainable agriculture. This is, however, only a partial picture, as many other factors may influence these processes. This section proposes a reflection going beyond innovation and agricultural policies focusing on the key characteristics of policies with the potential to promote transformation.
Transformative policies can be defined as policies that contribute to transforming incumbent socio‑technical systems. They tend to address the root causes of problems rather than just fixing them by isolating them from their systemic context. The advocates of transformative policies view policy making as a set of complex processes involving a multiplicity of actors, networks and institutions – each of them with different values, principles, interests, rules – which interact with each other. This complexity, as well as historically established commitments, may create systemic barriers to change (Smith and Stirling, 2007[161]), which must be challenged. To be transformative, according to Weber and Rohracher (2012[7]), policies need to address their four weakness: 1) directionality; 2) policy co-ordination; 3) market articulation; and 4) reflexivity.
Directionality refers to the capacity of the political system to steer innovation in a market context, with “grand challenges” set as innovation goals. Given that innovation cannot be obtained solely by law, the issue of gaining consensus over goals that could encourage businesses, civil society and consumers to innovate in a way that is consistent with societal challenges is becoming increasingly crucial. In the area of agricultural policies, the basic structure of the CAP since the Treaty of Rome has been aimed at supporting farmers’ incomes, productivity and competitiveness. A narrative based on “addressing market failures” was translated into support for prices, market intervention measures and trade tariffs. Support for investments was supposed to create a level playing field, allowing smaller farms to compete with bigger ones. While the following CAP reforms have introduced additional objectives and instruments (Chapter 3), innovation policies have largely focused on supporting technological developments rather than on innovative business models and social and institutional innovation (Chiffoleau and Loconto, 2018[162]).
The EGD, and the related Farm to Fork and Biodiversity Strategies, have set a new direction and a new narrative, which starts from the evidence that business as usual is no option, and, backed by the Paris Agreement and the Sustainable Development Goals, advocates for an ecological transition which will lead to a carbon-neutral European economy. The vision of the Green Deal is turned into sector-based goals and numeric targets, and the implementation of the strategy will be subject to an indicator-based monitoring framework (Section 5.1 and Chapter 3, Section 3.5).
Policy co-ordination (or policy coherence) is another property of transformative policies. It refers to the fact that policy systems are articulated into multiple policy areas and multiple administration levels, and that each of them follows a given set of rules, has a specific knowledge base, and refers to specific coalitions of interests. Reform at one point of this system might encounter resistance at other points, hence hampering innovation. Policy co-ordination is a key issue in the implementation process of the EGD. The multidimensionality of food systems makes it evident that the vast structure created by the CAP cannot be reformed only “from within”, that is by the European Commission’s Directorate-General for Agriculture and Rural Development, but requires a horizontal (across policy areas) and vertical (across scales of governance) co-ordination. The implementation of the EGD is led by the Vice‑President of the European Commission, and involves several directorates-general (Marti, 2020[163]) (Chapter 3, Section 3.5).
Market articulation can be described as “making innovation economically sustainable”. For the agricultural sector, for instance, the issue is creating market mechanisms that encourage sustainable agricultural production. In this context, questions like “How to make organic farming affordable to consumers and remunerative for farmers?” or “How to make nutritious food more attractive than junk food?” become very pertinent. Some potentially relevant measures, e.g. “school fruit, vegetables and milk scheme”, are included in the “CAP toolbox” that EU Member States have at their disposal when developing their CSPs (Chapter 3, Section 3.5). Nevertheless, it is unclear to what extent CSPs will be able to prioritise such measures and link them to better nutrition and sustainability goals.
Reflexivity relates to the need for policy systems to accompany, adapt to or even anticipate the dynamics of change. Reflexivity implies the capacity of policy systems to experiment and learn. The success of transformational policies will be based on the capacity of the governance system to evolve in a way that will make transformation forces prevail over conservation drivers. Given the complexity and the uncertainty of the problems at stake, the critical issue is how to provide spaces for experimentation and policy learning. Some of the CAP measures, e.g. the European Innovation Partnership for Agricultural Productivity and Sustainability (EIP-AGRI), can foster experimentation through its operational groups and establish links to EU R&I policies (Section 5.6). Moreover, research policies are more and more clearly “mission-oriented” (Section 5.3) and emphasise the impact of projects. The main targets identified by the Farm to Fork – increase of organic farming area and protected areas – could be seen as experimentation spaces for new practices and new business models. A performance-based policy implies a radical enhancement of the quality and quantity of available data and of evaluation methods. However, a key question remains over how to make monitoring and evaluation the core of learning spaces that involve, through deliberation, all actors, policy makers and civil society.
Annex 5.A. Statistical Annex
Annex Table 5.A.1. Government budget allocation for R&D (GBARD) on agriculture by EU Member State
Notes: 2006 and 2021 or the nearest available year.
Government budget allocation for research and development (GBARD) is a funder-based approach for reporting R&D, which involves identifying all the budget items that may support R&D activities and measuring or estimating their R&D content. It allows linking these budget lines to policy considerations through classification by socio-economic objective. GBARD on agriculture covers all R&D aimed at the promotion of agriculture, forestry, fisheries and foodstuff production, or furthering knowledge on chemical fertilisers, biocides, biological pest control and the mechanisation of agriculture, as well as concerning the impact of agricultural and forestry activities on the environment. This also covers R&D aimed at improving food productivity and technology. It does not include R&D on the reduction of pollution; on the development of rural areas; on the construction and planning of buildings; on the improvement of rural rest and recreation amenities and agricultural water supply; or on energy measures.
Source: Authors’ calculations based on Eurostat (2022[37]), GBARD by socioeconomic objectives (NABS 2007) (database).
Annex Table 5.A.2. R&D expenditure intensities by EU Member State
Notes: 2006, 2020 and 2019, or the nearest available year.
1. Gross domestic expenditure on research and development (GERD) is defined as the total expenditure (current and capital) on R&D carried out by all resident companies, research institutes, university and government laboratories, etc., in a country. It includes R&D funded from abroad, but excludes domestic funds for R&D performed outside the domestic economy.
2. GERD for agricultural and veterinary.
3. Government budget allocation for research and development (GBARD) is a funder-based approach for reporting R&D, which involves identifying all the budget items that may support R&D activities and measuring or estimating their R&D content. It allows linking these budget lines to policy considerations through classification by socio-economic objective.
4. GBARD on agriculture covers all R&D aimed at the promotion of agriculture, forestry, fisheries and foodstuff production, or furthering knowledge on chemical fertilisers, biocides, biological pest control and the mechanisation of agriculture, as well as concerning the impact of agricultural and forestry activities on the environment. This also covers R&D aimed at improving food productivity and technology. It does not include R&D on the reduction of pollution; on the development of rural areas; on the construction and planning of buildings; on the improvement of rural rest and recreation amenities and agricultural water supply; or on energy measures.
5. Business expenditure on research and development (BERD) is the measure of intramural R&D expenditures within the business enterprise sector (regardless of the sources of R&D funds).
6. BERD on agriculture, forestry and fishing.
7. BERD on manufacture of food products, beverages and tobacco products.
8. The European Union (27 countries) aggregate was estimated for the BERD on agriculture and on food and beverage.
Sources: Authors’ calculations based on OECD (2022[40]), Research and Development Statistics (database), [Gross domestic expenditure on R&D by sector of performance and field of R&D (FORD); Government budget allocations for R&D; Business enterprise R-D expenditure by industry (ISIC 4)]; STI Main Science and Technology Indicators (database), [BERD as a percentage of GDP]; and National Accounts (database), [Gross domestic product (GDP) – Gross value added at basic prices by activity, ISIC rev4; Value added and its components by activity, ISIC rev4], https://stats.oecd.org (accessed in August 2022); Eurostat (2021[41]), BERD by NACE Rev. 2 activity [RD_E_BERDINDR2], “GBARD by socioeconomic objective (NABS 2007)” [GBA_NABSFIN07], GDP and main components [NAMA_10_GDP], National accounts aggregates by industry (up to NACE A*64) [NAMA_10_A64], http://ec.europa.eu/eurostat/data/database (accessed in August 2022); USDA ERS (2017[42]), Agricultural Research Funding in the Public and Private Sectors, https://www.ers.usda.gov/data-products/agricultural-research-funding-in-the-public-and-private-sectors (accessed in February 2020).
Annex Table 5.A.3. Agriculture and food science R&D outcomes
Agriculture and food science R&D outcomes, 2010-20 (publications) and 2008-18 (patents)
Notes: Shares for economies having less than 50 patents or publications in a given period are shown.
1. Patents filed under the Patent Co-operation Treaty (PCT) by earliest filing date and location of inventors using fractional counts for specialisation and contribution, and using whole counts for collaboration. Agri-food includes patents from IPC classes: A01, A21, A22, A23, A24, B21H 7/00, B21K 19/00, B62C, B65B 25/02, B66C 23/44, C08b, C11, C12, C13, C09K 101/00, E02B 11/00, E04H 5/08, E04H 7/22 and G06Q 50/02. Data refer to patents filed in at least two offices worldwide, one of which being any of the five largest intellectual property offices: the European Patent Office (EPO), the Japan Patent Office (JPO), the Korean Intellectual Property Office (KIPO), the US Patent and Trademark Office (USPTO) and the National Intellectual Property Administration of the People’s Republic of China (NIPA).
2. Publications in the field of agricultural and biological science refer to the SCOPUS 2-digit All Science Journals Classification and include the following categories: agronomy and crop science, animal science and zoology, aquatic science, ecology/evolution/behaviour and systematics, food science, forestry, horticulture, insect science, plant science, soil science, and miscellaneous agriculture/biological sciences. Data are based on fractional counts.
3. Top 10% of the world’s most cited publications in the field of agricultural and biological science.
Sources: Authors’ calculations based on OECD (2022[64]), STI Micro-data Lab: Intellectual Property Database, http://oe.cd/ipstats (accessed August 2022); OECD (2022[65]), OECD STI calculations based on Scopus Custom Data, Elsevier, Version 1.2018; 2018 Scimago Journal Rank from the Scopus journal title list (accessed August 2022).
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Notes
← 1. More information on the survey can be found in Annex 1.B.
← 2. The term AKIS, normally used in the European context, roughly corresponds to the Agricultural Innovation System (AIS), which is the terminology usually used by the OECD in its Productivity, Sustainability and Resilience Framework (OECD, 2020[63]).
← 3. Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021.
← 4. The reviews of the Netherlands (OECD, 2023[101]) and Spain (OECD, 2023[167]) provide a full discussion of the national-level actors and initiatives in these two countries.
← 5. The results of the EU Member States survey on agricultural innovation policies (OECD, 2022[5]) show that 9 out of 19 responding units considered the ministry responsible for agriculture as the main actor responsible for the strategic direction of agri-food innovation. See Annex 1.B for more information on the survey.
← 6. 6 Other end-users may include forest owners, food businesses, engineers, local authorities, etc.
← 7. 7 “Public goods are goods that are non-rival (many persons can consume or use them without diminishing their availability to others) and non-excludable (once available to one person it is difficult to exclude others from using it)” (Heisey and Fuglie, 2018[32]).
← 8. 8 R&D intensity is defined as expenditure for R&D in the agricultural and food and beverages sectors, and in the economy as a whole, in relation to the size of the sector or the economy.
← 9. 9 “Agriculture”, under both the CAP and the Horizon 6 cluster, should be seen from a broader perspective as encompassing all activities related to agriculture and rural areas.
← 10. 10 In this chapter, the funding shown for Measure 16 also includes sub-measures that do not target innovation or knowledge exchange.
← 11. 11 These are intermediate figures, the Operational Group’s projects and related measures of the 2014-22 period payments can be made until the end of 2025.
← 12. 12 Calculated based on data provided by the European Commission in the frame of the OECD “Agricultural Policy Monitoring and Evaluation” (2022[34]). The percentages only cover expenditure from the rural development budgets, both national and EU, and exclude resources additionally provided by countries from other national budget lines.
← 13. 13 Due to the high degree of autonomy within the Belgian federation, Belgium (Flanders) and Belgium (Wallonia) are treated as two entities in this survey. For more details refer to Annex 1.B.
← 14. 14 Co-programmed European Partnerships are initiatives between the European Commission and mostly private (sometimes public) partners. The co-operation is based on a memorandum of understanding or a contractual agreement which defines the objective of the partnership, the commitments from both parties and the governance structure. Implementation takes place primarily through the Horizon Europe work programmes and their calls for proposals, with grants fully funded by Horizon Europe. Complementary R&I activities developed by the European Commission’s partners are not funded by Horizon Europe but are included in the Strategic Research and Innovation Agendas of the partnerships.
Co-funded European Partnerships are initiatives between the European Commission and a consortium of partners structured around research funders and other public authorities. They are based on a grant agreement resulting from a call for proposals for the co-financing of a programme activity under Horizon Europe’s work programme. It is suitable for partnerships involving public authorities, but it is also possible to include foundations and international partners.
Institutionalised European Partnerships are initiatives between the European Union, several EU Member States and/or industry. They are based on a Decision by the Council and the European Parliament in accordance with Article 185 the Treaty on the Functioning of the European Union, or by bodies established through a Decision of the Council pursuant to Article 187 of the Treaty on the Functioning of the European Union. Such partnerships will only be implemented if other instruments under Horizon Europe, including other forms of European Partnerships, would not achieve the objectives or generate the expected impacts, and if justified by a long-term perspective and high degree of integration.
← 15. 15 BRICS is an acronym for six economies: Brazil, Russia, India, China, and South Africa.
← 16. 16 The EU Labour Force Survey (EU-LFS) is a large household sample survey providing quarterly/annual results on labour participation of people aged 15 and over as well as on people outside the labour force (e.g. students and pensioners). These data are comparable across countries, sectors and occupations at the European level. Chapter 2 of this review uses data from the Farm Structure Survey to analyse “farm” labour force. The Farm Structure Survey is conducted across the European Union every three or four years as a sample of agricultural holdings survey and once every ten years as a census. The EU-LFS and the Farm Structure Survey differ in terms of sample definition (household vs agricultural holdings), and therefore results from these data sources may not be comparable.
← 17. 17 Section 5.4 refers to the whole sector of agricultural, forestry and fishing due to the availability of EU-LFS data on skills. Sector classification in the EU-LFS is based on the NACE at 1 digit level (or Level 1). The NACE Level 1 consists of 21 sectors, including “Agriculture, Forestry and Fishing”. Due to limit of sampling methods in some Member States, it was not possible to disaggregate data only for the agricultural sector.
← 18. 18 According to the International Standard Classification of Occupations (ISCO) 2-digit code, skilled farm workers is officially labelled as skilled agricultural, forestry and fishery workers (ISCO61), while agricultural labourers (ISCO92) is part of elementary workers. Other occupation groups include, for example, science and engineering technicians, technical managers, and clerks
← 19. 19 Skills imbalances are misalignments between the demand and supply of skills in the economy, and comprise skills shortages and surpluses, and skills mismatches.
Skills shortages refer to a disequilibrium condition in which the demand for a specific type of skill exceeds its supply in the labour market at the prevailing market wage. Skills surpluses arise when the supply of a specific type of skill exceeds its demand in the labour market.
Skills mismatches are when workers have higher or lower skills proficiency than what is required by their job. Skills mismatches can be measured in different ways:
Qualification mismatch: when workers have an educational attainment that is higher or lower than what is required by their job. If their qualification level is higher, workers are classified as overqualified; if it is lower, they are classified as underqualified.
Field-of-study mismatch: when workers are employed in a different field from that in which they have specialised (OECD, 2016[84]).
← 20. 20 Training and education skills refer to knowledge of the principles and methods of curriculum and training design, teaching and instructing individuals and groups, and measuring the effects of training, as well as of the ability to teach others how to do something.
← 21. 21 Data on skills shortage and mismatch are from the OECD Skills for Jobs Database, which covers the whole agriculture, forestry and fishing sector. Although skills shortages and mismatches among forestry and fishing workers might differ from those in the agricultural sector, overall, the majority of agricultural, forestry and fishing workforce in the European Union is engaged in agricultural activities. However, the importance of the forestry and fisheries sectors is not evenly distributed across Europe, which may influence the skills imbalance profiles at Member State level.
← 22. 22 The level of skills mismatch depends on multiple factors, such as labour market conditions and the age structure in the sector. It is possible that the skills mismatches among young farmers, who are subject to certification requirements, e.g. to benefit from the Young Farmer Scheme, will be lower than among older farmers. However, due to the low proportion of farm holders under 35, e.g. 5% in Ireland in 2016 (Central Statistics Office, 2018[166]), upskilling in the sector may not be visible. Further analysis is needed to explore drivers of skills mismatches across EU Member States.
← 23. 23 “OECD Skills Strategies – Assessment and Recommendations” country reports cover Austria, Belgium, Northern Ireland, Italy, Latvia, the Netherlands, Poland and Spain. They are available at: https://www.oecd.org/fr/competences/oecd-skills-strategies.htm.
← 24. 24 Belgium is excluded due to multiple counting.
← 25. 25 The Advanced Certificate is a Level 6 award on the National Framework of Qualifications. Most certificates at this level enable students to develop a wide range of skills relevant to their chosen career path. Modules include advanced vocational and occupational skills.
← 26. 26 Regulation (EC) No. 1907/2006/EC of 18 December 2006 concerning the Registration, Evaluation, Authorisation and Restriction of Chemicals (REACH) and establishing a European Chemicals Agency. Available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02006R1907-20140410.
← 27. 27 Directive 2000/60/EC of the European Parliament and of the Council of 23 October 2000 establishing a framework for Community action in the field of water policy. Available at: https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32000L0060&qid=1674225575750.
← 28. 28 In 2018, the European Court of Justice applied the precautionary principle on the matter of gene-edited species and ruled that they are to be considered as legally identical to GMOs and, therefore, they fall within the scope of Directive 2001/18/EC on the release of GMOs into the environment, being simultaneously governed by strict rules applicable to GMOs under this directive. Case C-528/16 of 25 July 2018, available at: https://curia.europa.eu/juris/liste.jsf?language=en&num=C-528/16.
← 29. 29 It shall be noted, however, that the Directive 2001/18/EC lays down an exemption for organisms obtained through certain techniques of genetic modification which have conventionally been used in a number of applications and have a long safety record. In its recent ruling, the European Court of Justice, for instance, clarified that organisms obtained by the in vitro application of a technique of mutagenesis shall benefit from this exemption. Case C-688/21 of 7 February 2023, available at https://curia.europa.eu/juris/document/document.jsf;jsessionid=5A657ACA97A3B45503CF3DC82E9C6E42?text=&docid=270253&pageIndex=0&doclang=EN&mode=req&dir=&occ=first&part=1&cid=2200376.
← 30. 30 The Agreement on Trade-Related Aspects of Intellectual Property Rights made compulsory the protection of plant varieties either by patents or by a sui generis system. Moreover, it made patentability of microorganisms and non‑biological and microbiological processes for the production of plant varieties compulsory for signatory countries of the World Trade Organization.
← 31. 31 The European Innovation Partnership concept resulted from the European Commission’s thinking on the Innovation Union flagship initiative of the Europe 2020 growth strategy (EC, 2010[165]).
← 32. 32 Digitalisation can be defined as “the adoption of information communication technologies, including the Internet, mobile technologies and devices, as well as data analytics, to improve the generation, collection, exchange, aggregation, combination, analysis, access, searchability and presentation of digital content, including for the development of services and applications” (McFadden et al., 2022[153]).
← 33. 33 Internet of Things describes physical objects, or groups of such objects, with sensors, processing ability, software and other technologies that connect and exchange data with other devices and systems over the Internet or other communications networks.
← 34. 34 Commission implementing Regulation (EU) 2021/2286 of 16 December 2021.