Income Distributional Effects of CAP Subsidies

Ciaian, Pavel; Kancs, d’Artis; Paloma, Sergio Gómez y

doi:10.5367/oa.2015.0196

Cited by 32 publications

(41 citation statements)

References 43 publications

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“…Furthermore, decoupled payments tend to increase farmers' access to regular incomes as well as access to capital inputs and other productive inputs that can facilitate farm production. More so, there are arguments that farmers may increase their level of production with the belief that future payment schemes may be assessed based on previous levels of production [11,27].…”

Section: Previous Studiesmentioning

confidence: 99%

“…To the best of our knowledge, most of the existing studies on econometric analysis of the impact of decoupled payments on production are focused on crop production with little attention on livestock production. The large concentration of existing studies on crop production with little or none on livestock production is rather surprising considering that amount of payments received by farms differ production choice [19,27], suggesting that farmers' behaviour in response to agricultural subsidies can differ across farming enterprises [5,17,21,28]. Using farm-level panel data from Northern Ireland's dairy, beef and sheep production farm enterprises, this paper aims to fill this vacuum in the literature by exploring the impact of decoupled payments on production.…”

Section: Introductionmentioning

confidence: 99%

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Estimating the Impact of Decoupled Payments on Farm Production in Northern Ireland: An Instrumental Variable Fixed Effect Approach

Olagunju

Patton²,

Feng³

2020

Sustainability

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The production stimulating impact of agricultural subsidies has been a well-debated topic in agricultural policy analysis for some decades. In light of the EU reform of the Common Agricultural Policy (CAP) in year 2005 in which agricultural subsidies were decoupled from current production decisions and the modification to this payment in 2015, this study investigates the impact of decoupled payments under these two reforms on livestock production in Northern Ireland. The study uses a farm-level panel dataset covering 2008–2016 period and employs an instrumental variable fixed effect model to control for relevant sources of endogeneity bias. According to the empirical results, the production impacts of decoupled payments were positive and significant but with differential impacts across livestock production sectors, suggesting that decoupled payments still maintain a significant effect on agricultural production and provide an indication of the supply response to changes in decoupled payments.

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Section: Previous Studiesmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Estimating the Impact of Decoupled Payments on Farm Production in Northern Ireland: An Instrumental Variable Fixed Effect Approach

Olagunju

Patton²,

Feng³

2020

Sustainability

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“…Among the few studies that tested the effect of implementing CAP subsidies on the structure of production, farm income, performance, and sustainability of the agricultural sector are those by Sarov and Kostenarov [41], Garrone et al [42], Ciaian et al [43], Kravčáková Vozárová and Kotulič [44], Rizov et al [45], and Bojnec and Ferto [46].…”

Section: Introductionmentioning

confidence: 99%

Assessing Impacts of CAP Subsidies on Financial Performance of Enterprises in Slovak Republic

2020

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Sustainability is a particularly crucial factor in policy formulation and analysis, including in the EU’s common agricultural policy. The common agricultural policy, through a subsidy policy, has caused a significant proportion of public funding to flow to agricultural subsidies, so it is appropriate to focus on the effect of these subsidies in the context of the sustainable development of EU agriculture. The impact of agricultural subsidies on business performance is of interest to policy makers. In agrarian practice, insufficient attention is paid to the legal form of agricultural performance, so our economic analysis focused on this area of research. The aim of the paper was to evaluate the effect of financial support in the form of subsidies resulting from the EU’s common agricultural policy and to verify its connection with the performance of agricultural enterprises in terms of the legal form in the context of sustainable development of the agricultural sector in Slovakia. No statistically significant linear correlation was found between farms’ performance results and the volume of subsidies per hectare of agricultural land for each legal form throughout the reporting period. In each analyzed year, business companies achieved a better overall assessment than agricultural cooperatives based on monitored parameters.

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“…It is also possible that the land receiving agri-environmental support has less favorable natural conditions for agricultural production, which is ultimately reflected in lower land prices. This hypothesis is indirectly supported by Ciaian et al (2015), whose estimates show that agrienvironmental and LFA payments are fully translated in higher farm income, suggesting that these payments may exercise minimal impact on other factors such as land prices. The estimates of Mary (2013) show that LFA payments have negative and significant impact on farm productivity of French crop farms, whereas agri-environmental payments are found to have no impact on productivity.…”

Section: Environmental Regulationsmentioning

confidence: 93%

Land markets in EuropeInstitutions and market outcomes 1

Ciaian¹,

Kancs²,

Drábik³

2017

Public Policy in Agriculture

Self Cite

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In this chapter, we review land market institutions in the European Union (EU) and their potential impact on land markets. We first review land tenure-/ownership regulations and find that they vary heavily across EU Member States. Four types of tenure-/ownership measures are implemented in the EU: to protect the tenant, to protect the owner, to protect the (non-farm) land owner, and to prevent land fragmentation. We then examine EU land-related environmental regulations whose general objective is to address land market failures linked to externalities and the provision of public goods. Despite possibly reducing private benefits of land owners or users, environmental regulations may generate welfare gains to society by improving the environmental services on land. Finally, we investigate how area-based subsidies affect land prices. These subsidies are empirically found to be partially capitalized into land values, albeit at a lower rate than suggested by theory.

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Income Distributional Effects of CAP Subsidies

Cited by 32 publications

References 43 publications

Estimating the Impact of Decoupled Payments on Farm Production in Northern Ireland: An Instrumental Variable Fixed Effect Approach

Estimating the Impact of Decoupled Payments on Farm Production in Northern Ireland: An Instrumental Variable Fixed Effect Approach

Assessing Impacts of CAP Subsidies on Financial Performance of Enterprises in Slovak Republic

Land markets in EuropeInstitutions and market outcomes 1

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