The Production Effects of Agricultural Income Support Policies under Uncertainty

Hennessy, David A.

doi:10.2307/3180267

Cited by 355 publications

(240 citation statements)

References 1 publication

(1 reference statement)

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“…An important issue is whether "decoupled policies" are truly decoupled (e.g. Chau and de Gorter 2005;de Gorter 2007;Goodwin and Mitra, 2006;Hennessy, 1998;OECD, 2001a;Serra et al, 2005). This not only holds for the impact of policies on production, and hence trade, but also on the distribution of the policy rents.…”

Section: Introductionmentioning

confidence: 99%

Credit Market Imperfections and the Distribution of Policy Rents: The Common Agricultural Policy in the New EU Member States

Ciaian

Swinnen

2007

SSRN Journal

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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 EconStor may AbstractThis article analyses how credit market imperfections affect the impacts of subsidies by analyzing the effects of agricultural subsidies in the new Eastern Member States of the European Union with a partial equilibrium model which integrates credit and land market imperfections. We show that credit constraints have important implications for the distribution of policy rents. Credit market imperfections may induce very different effects of direct payments and lump-sum transfers.

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Section: Introductionmentioning

confidence: 99%

Credit Market Imperfections and the Distribution of Policy Rents: The Common Agricultural Policy in the New EU Member States

Ciaian

Swinnen

2007

SSRN Journal

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“…Direct payments have an insurance effect itself (reducing the relative variability of quasi rents) and reduce the (absolute) risk aversion of the farmer (by shifting his welfare level upwards). Hennessy (1998) provides detailed descriptions and proofs of the insurance and wealth effects of direct payments.…”

Section: Results For Certainty Equivalentsmentioning

confidence: 99%

Risk management strategies to cope with climate change in grassland production: an illustrative case study for the Swiss plateau

Finger

Calanca

2011

Reg Environ Change

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In this paper, we assess climate change impacts on an intensively managed grassland system at the Swiss Plateau using the process-based grassland model PROGRASS. Taking the CO 2 fertilization into account, we find increasing yield levels (in the range of 10-24%) and sharp increases in production risks for an illustrative climate change scenario that suggests a marked increase in temperature and decrease in summer rainfall. Climate change-induced increases in the coefficients of variation of grassland yields are in the range of 21 and 50%. This finding underpins that additional risk management strategies are needed to cope with climate-change impacts on grassland production. The outputs from the grassland model are evaluated economically using certainty equivalents, i.e., accounting for mean quasi rents and production risks. To identify potential risk management strategies under current and future climatic conditions, we consider adjustments of production intensity and farm-level yield insurance. The impact of climate change on production intensities is found to be ambiguous: farmers' will increase intensity under unconstrained production conditions, but will decrease production intensity in the presence of a cross-compliance scheme. Our results also show that the considered insurance scheme is a powerful tool to manage climate risks in grassland production under current and future conditions because it can reduce the coefficients of variation of quasi rents by up to 50%. However, we find that direct payments tend to reduce farmers' incentives to use such insurance scheme.

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“…Various models are reflected in the structure of political rents, namely subsidies and payments under the Pillars I and II of the CAP. It is assumed throughout that the total value of these political rents is the sum of cash transfers (subsidies and payments) to the EU farms under the Although the question of how subsidies affect the productivity (as opposed to production) of farms in the EU has been studied by many authors, it has not yet been definitively answered (Olley and Pakes 1996;Hennessy 1998;Ciaian and Swinnen 2009;Rizov et al 2013;Banga 2014). These studies show that prior to the decoupling reform (Luxembourg 2003), subsidies had a positive impact on production, but a negative impact on productivity.…”

Section: Doi: 1017221/302/2015-agriceconmentioning

confidence: 99%

The regional structure of the CAP subsidies and the factor productivity in agriculture in the EU 28

Czyżewski¹,

Smędzik-Ambroży²

2017

AGR ECON-CZECH

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Czyzewski B., Smedzik-Ambrozy K. (2017): Th e regional structure of the CAP subsidies and the factor productivity in agriculture in the EU 28. Agric. Econ. -Czech, 63: 149-163.Abstract: Th e question of what eff ect the subsidies have on the productivity of farms in the EU has been studied by many authors, but has not yet been answered. A further research is thus required both in relation to the period since the decoupling reform, and in relation to the new member countries in the EU 28. In the paper, it is suggested that the productivity of resources in agriculture is not aff ected by the total amounts of subsidies, but by their structure. A three-stage spatial analysis was made of an EUFADN representative sample in the years 2007-2012: in the fi rst stage, clusters of regions with signifi cantly diff erent agricultural support models were identifi ed; in the second, it was determined whether the structure of the political rent, refl ecting the diff erent support models in the EU 28, is a signifi cant determinant of the productivity of capital, land and labour on farms when subsidies are excluded and when they are included in the analysis. In the third stage, a robust model has been estimated (employing GLS) to relate the factors productivity to the EUFADN subsidies and to the location variables identifi ed by the cluster analysis. Th e analysis confi rmed that the qualitative predictor, i.e. "a structure of agricultural support", was a signifi cant factor infl uencing the capital productivity over the whole of the period.

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The Production Effects of Agricultural Income Support Policies under Uncertainty

Cited by 355 publications

References 1 publication

Credit Market Imperfections and the Distribution of Policy Rents: The Common Agricultural Policy in the New EU Member States

Credit Market Imperfections and the Distribution of Policy Rents: The Common Agricultural Policy in the New EU Member States

Risk management strategies to cope with climate change in grassland production: an illustrative case study for the Swiss plateau

The regional structure of the CAP subsidies and the factor productivity in agriculture in the EU 28

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