Decoupling and prices: determinant of dairy farmers’ choices?
AbstractIn this paper, we discuss the cross-effects on the productive strategy of French dairy farms due to the decoupling and to price variation. A model based on mathematical programming has been developed to determine how dairy farmers might re-evaluate their systems to identify an optimal production plan. The model is applied to four types of dairy farms in order to analyze the impact of the reform depending on farm’s activities. The simulations point out how the implementation of the decoupling encourages farmers to increase the share of grassland. However, the increase in cereal prices is a strong incentive to intensify forage production to free up land for crop production. Finally, after four years of decoupling, this study helps to put into perspective the theoretical effects of decoupling and the actual choices made by farmers. This article identifies six factors which could explain these differences: the longterm production requirements, the eligibility criteria for the direct payment, the sociology/psychology of the farmer, the anticipation of a new reform, the trade organization and the value of property assets.
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Bibliographic InfoArticle provided by INRA Department of Economics in its journal Review of Agricultural and Environmental Studies.
Volume (Year): 92 (2011)
Issue (Month): 1 ()
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dairy farm; single payment; decoupling; price variation; mathematical programming; technical system;
Find related papers by JEL classification:
- Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
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