Improvements in beef cattle productivity can increase economy-wide activity and simultaneously reduce greenhouse gas emissions in Scotland

Cutting emissions from agriculture will be important in meeting emissions reduction targets. However, there are concerns that such outcomes might require reductions in the scale of agricultural activity, with negative impacts on agriculture reliant economies. A number of policies seek to improve the productivity of the agricultural sector, i.e. permitting increased output from a given set of inputs, but the impact of such policies on emissions or economic activity is unclear. The objective of this study is to demonstrate how a Computable General Equilibrium model can be used to undertake ex ante analysis of the potential economic and environmental impacts of full implementation of a policy targeted at raising productivity in Scotland’s beef farming sector. We find positive impacts on economic variables and reductions in emissions, largely generated through reductions in the size of the capital stock in the beef farming sector. Our results contribute to a growing and important literature exploring the future capability of the agricultural sector to provide livelihoods, while minimising its environmental impacts.