Revenue and Cost Functions in PMP: a Methodological Integration for a Territorial Analysis of CAP

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Revenue and Cost Functions in PMP: a Methodological Integration for a Territorial Analysis of CAP

Author Info

Arfini, F.
Donati, M.
Grossi, L.
Paris, Q.

Abstract

An integrated policy evaluation tool is proposed for assessing the effects of agricultural policy measures using all the information available at farm level. The tool combines the positive mathematical programming methodology with the cluster analysis technique by using the same panel of data. The PMP model proposed here allows to measure the effects of policy in term of agricultural supply responses including output market price variations. The novel procedure by which the PMP model is articulated permits to recover the set of farm level demand functions for agricultural products and the cost function characterizing the given sample of farms. Cluster analysis is useful for better appreciating the behaviour of farms before and after the policy scenario analysis by considering the transfers of farms among clusters. A decoupling scenario assessment presents the responses that the integrated tool can provide for evaluating agricultural policy instruments.

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Paper provided by European Association of Agricultural Economists in its series 107th Seminar, January 30-February 1, 2008, Sevilla, Spain with number 6636.

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Date of creation: 2008
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Handle: RePEc:ags:eaa107:6636

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NEP-ALL-2008-11-25 (All new papers)

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Thomas Heckelei & Hendrik Wolff, 2003. "Estimation of constrained optimisation models for agricultural supply analysis based on generalised maximum entropy," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 30(1), pages 27-50, March.
Yves Léony & Ludo Peeters & Maurice Quinqu & Yves Surry, 1999. "The Use of Maximum Entropy to Estimate Input-Output Coefficients From Regional Farm Accounting Data," Journal of Agricultural Economics, Blackwell Publishing, vol. 50(3), pages 425-439. [Downloadable!] (restricted)
Lence, Sergio H & Miller, Douglas J, 1998. "Estimation of Multi-output Production Functions with Incomplete Data: A Generalised Maximum Entropy Approach," European Review of Agricultural Economics, Oxford University Press for the Foundation for the European Review of Agricultural Economics, vol. 25(2), pages 188-209.

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