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Agricultural Subsidies and Rural Development

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  • Karine Daniel
  • Maureen Kilkenny

Abstract

How consistent is a single farm payment system with rural development goals? A new economic geography model is used to compare coupled subsidies to ‘single farm payments’ effects on the location of farming, agro‐industry and non‐farm activity between rural and urban areas. This abstract model features a majority of employment in service sectors, farming vertically linked to manufacturing, and strong preferences for geo‐varieties. It appears that both coupled subsidies and single farm payments can decrease spatial agglomeration. But only the single farm payment policy raises welfare in both rural and urban regions of this stylised economy.

Suggested Citation

  • Karine Daniel & Maureen Kilkenny, 2009. "Agricultural Subsidies and Rural Development," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(3), pages 504-529, September.
    • Handle: RePEc:bla:jageco:v:60:y:2009:i:3:p:504-529
    DOI: 10.1111/j.1477-9552.2009.00214.x
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    3. G. Lindberg & P. Midmore & Y. Surry, 2012. "Agriculture’s Inter-industry Linkages, Aggregation Bias and Rural Policy Reforms," Journal of Agricultural Economics, Wiley Blackwell, vol. 63(3), pages 552-575, September.
    4. Deping Ye & Shangsong Zhen & Wei Wang & Yunqiang Liu, 2023. "Spatial double dividend from China’s main grain-producing areas policy: total factor productivity and the net carbon effect," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-22, December.
    5. Chen, You-hua & Chen, Mei-xia & Mishra, Ashok K., 2020. "Subsidies under uncertainty: Modeling of input- and output-oriented policies," Economic Modelling, Elsevier, vol. 85(C), pages 39-56.
    6. Schaeffer, Yves & Aubert, Francis, 2010. "La pertinence de la politique rurale à l’aune des théories de la justice," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 91(1).
    7. Hyytia, Nina, 2011. "Allocation of CAP modulation funds to rural development measures at the regional level in Finland," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114525, European Association of Agricultural Economists.
    8. Nina Hyytiä, 2014. "Farm diversification and regional investments: efficient instruments for the CAP rural development targets in rural regions of Finland?," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 41(2), pages 255-277.
    9. Marco Baudino, 2021. "Rural-to-urban migration in developing economies: characterizing the role of the rural labor supply in the process of urban agglomeration and city growth," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(3), pages 533-556, June.
    10. Hyytiä Nina, 2014. "Rural-Urban Multiplier and Policy Effects in Finish Rural Regions: an Inter-Regional Sam Analysis," European Countryside, Sciendo, vol. 6(2), pages 1-23, June.
    11. V. Santoni & M. Pulina, 2016. "An analysis on the Italian agricultural firms: effects of public subsidies," Working Paper CRENoS 201611, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    12. Yves Schaeffer & Francis Aubert, 2010. "La pertinence de la politique rurale à l’aune des théories de la justice," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 91(1), pages 73-101.
    13. Maureen Kilkenny, 2010. "Urban/Regional Economics And Rural Development," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 449-470, February.
    14. Glover, Jane, 2011. "Where has all the cream gone: How sustainable is the English dairy supply chain?," 85th Annual Conference, April 18-20, 2011, Warwick University, Coventry, UK 108940, Agricultural Economics Society.

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