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Land Market Imperfections and Agricultural Policy Impacts in the New EU Member States: A Partial Equilibrium Analysis

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  • Pavel Ciaian
  • Johan F.M. Swinnen

Abstract

This article analyses how transaction costs and imperfect competition in the land market affect the welfare effects of agricultural subsidies in the new Eastern Member States of the European Union. Benefits of land subsidies end up with landowners in new Eastern Member States also with imperfections in the new Eastern Member States land markets. With unequal access to subsidies, small tenant farmers may even lose out from the subsidies. Decoupling of payments shifts policy rents to farmers, but constrains productivity-enhancing restructuring. Using reserve entitlements to mitigate this effect reduces the intended benefits on distortions and target efficiency. Copyright 2006, Oxford University Press.

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File URL: http://hdl.handle.net/10.1111/j.1467-8276.2006.00899.x
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Bibliographic Info

Article provided by Agricultural and Applied Economics Association in its journal American Journal of Agricultural Economics.

Volume (Year): 88 (2006)
Issue (Month): 4 ()
Pages: 799-815

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Handle: RePEc:oup:ajagec:v:88:y:2006:i:4:p:799-815

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  1. Johan Swinnen & Liesbet Vranken, 2003. "Land Rental Markets and Household Farms in Transition: Theory and Evidence from Hungary," LICOS Discussion Papers 12903, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  2. Csaki, Csaba & Lerman, Zvi, 2001. "Land And Farm Structure In Poland," Discussion Papers 14998, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
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