Modeling the Reforms of the Common Agricultural Policy for Arable Crops under Uncertainty

Abstract:In recent years, food security, especially supply, has been an important issue in China's agricultural production. The stability of grain prices is related to the stability and development of the grain market. Based on agricultural production data from 1970 to 2015, this paper explores the influence of agricultural product price fluctuation on grain production by using the cobweb theory and vector error correction (VEC) model. The results show that changes in grain production in China are affected by fluctuations in agricultural product prices, that the production change lags behind the price change, and that there is a long-term equilibrium relationship between grain yield and agricultural product price. A Granger causality test shows that the change in agricultural product price is the Granger cause of grain yield change.

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“…Fraser and Legwegoh believe that national policies are needed to ensure adequate food storage [33]. Paul [34] and Sckokm [35] also thinks so.…”

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confidence: 99%

An Empirical Analysis of the Impact of Agricultural Product Price Fluctuations on China’s Grain Yield

Xie

Wang

2017

Sustainability

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“…It also allows for analysis regarding the impacts of policy reforms on the crop mix as well as on the use of agricultural inputs. Although previous analyses focused on the effects of the CAP reforms (see Serra et al, 2005;Oude Lansink and Peerlings, 1996;Moro and Sckokai, 2006;and OECD, 2006), no previous studies have used a distance function to assess the impacts of decoupling of farm production decisions.…”

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The impact of the 1999 CAP reforms on the efficiency of the COP sector in Spain

Lambarraa

Stefanou

Serra³

et al. 2009

Agricultural Economics

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The cereal, oilseeds, and protein crop sector (COP) occupies a prominent position within the European Union's agricultural sector. Within Spain, the COP sector accounts for almost a third of total Agricultural Guidance and Guarantee Fund expenses, and a half of the utilized agricultural area. The COP sector is not only relevant because of its physical and economic magnitude, but also because of the political attention it receives.The Common Agricultural Policy reforms that occurred during the 1990s paid special attention to this sector. This paper aims to determine the impacts of Agenda 2000 on a sample of Spanish COP farmers' production decisions by using an output-oriented stochastic distance function. The distance function allows for an assessment of the reformmotivated changes on total output, input used, input composition and crop mix. It also permits an assessment of the impacts of the reform on farms' technical efficiency.Results show that the reform has shifted the production frontier inward and changed output composition in favor of voluntary set aside land. With respect to input composition, Agenda 2000 induced a decrease in land, fertilizers, pesticides and other inputs in favor of labor. In addition, Agenda 2000 has had a negative impact on technical efficiency. IntroductionThe cereal, oilseeds and protein crop (COP) sector occupies a prominent position within the European Union's (EU) agricultural sector. This sector represented The EU is the third most important cereal producer in the world (behind China and the US) and accounts for 14.3% of total production, as well as 24.1% of world wheat exports and 42.9% of world barley exports (FAOSTAT, 2004). The main COP producing countries within the EU are France and Germany, followed by Italy, Poland and Spain.1 The rate of self-sufficiency in the EU is on the order of 118% for cereals, 80% for protein crops and 44% for oilseeds. The Spanish COP sector contributes 11%to the final agricultural output in Spain and is the third most frequent farming type among Spanish farms, after citrus and olive. Within Spain, the COP sector accounts for 28% of total EAGGF expenses, 48% of the UAA, and 37% of total agricultural area Compared to other EU producers, Spanish COP yields are lower with high annual variation due to uneven rainfall (Eurostat, 2007) 2 . Further, the average Spanish COP farm size (52.71 ha) is above the EU average (46.3 ha) (FAO, 2006; and Eurostat, 2008), although it is below the average farm size in France and Germany, on the order of 78.11 ha and 64.09 ha, respectively (Eurostat, 2008).The COP sector is not only relevant because of its physical and economic magnitude, but also because of the political attention it receives. The Common Agricultural Policy (CAP) reforms that occurred during the 1990s involved specific policies for this sector. The reform in 1992 and Agenda 2000 involved reductions in 1 France ranks first among European countries in COP production accounting for 23.3% of total production followed by Germany with 15%, an...

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“…Chau and de Gorter 2005;de Gorter 2007;Goodwin and Mishra, 2006;Hennessy, 1998;OECD, 2001OECD, , 2004Serra et al, 2005;Sckokai and Moro, 2006).…”

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Static and Dynamic Distributional Effects of Decoupled Payments: Single Farm Payments in the European Union

2008

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractThis paper analyses the distributional effects of decoupled Single Farm Payments (SFP) in the European Union. In a static world the SFP benefit only farmers, irrespective of the implemented SFP model and irrespective of whether entitlements are tradable or not, except when the size of the allocated entitlements is larger than the eligible area and/or if entrants are eligible for the SFP. Then the SFP gets either partially or fully capitalized into land values and landowners benefit. In a dynamic world the effects depend on the nature of structural change, on the tradability of entitlements, and on the implementation model.

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Modeling the Reforms of the Common Agricultural Policy for Arable Crops under Uncertainty

Cited by 120 publications

References 15 publications

An Empirical Analysis of the Impact of Agricultural Product Price Fluctuations on China’s Grain Yield

An Empirical Analysis of the Impact of Agricultural Product Price Fluctuations on China’s Grain Yield

The impact of the 1999 CAP reforms on the efficiency of the COP sector in Spain

Static and Dynamic Distributional Effects of Decoupled Payments: Single Farm Payments in the European Union

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