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The impact of reforming the Common Agricultural Policy on the sustainability of the irrigated area of Central Italy. An empirical assessment by means of a Positive Mathematical Programming model

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  • Cortignani, Raffaele
  • Severini, Simone
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    Abstract

    The Common Agricultural Policy (CAP) is a major driver of the environmental and social sustainability of the agriculture in the European Union (EU). Under the 2003 CAP reform, most direct payments to agricultural producers were decoupled from production. This work assesses the possible impact of the CAP reform on the sustainability of an irrigated area of Central Italy with particular attention being paid to decoupling. The analysis has been conducted using the Positive Mathematical Programming (PMP) method that directly estimates the cost function parameters by imposing the first-order conditions of the farm model under consideration. The analysis assesses the impact of the CAP reform on farm cropping patterns, water and chemical use, labour use and economic results. By referring to this set of indicators it is possible to investigate the likely effect of the CAP reform on the environmental, social and economic sustainability of the considered farming systems. The results of the empirical analysis mainly show a reduction in water and chemical input use, an increase in the economic results of farms, but also a reduction of the labour.

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    Bibliographic Info

    Paper provided by European Association of Agricultural Economists in its series 120th Seminar, September 2-4, 2010, Chania, Crete with number 109318.

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    Date of creation: 2010
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    Handle: RePEc:ags:eaa120:109318

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    Related research

    Keywords: Common Agricultural Policy; Sustainability; Positive Mathematical Programming; Farmers’ behaviour; Irrigated agriculture; Decoupling; Agricultural and Food Policy; Consumer/Household Economics; Crop Production/Industries; Demand and Price Analysis; Farm Management; Land Economics/Use;

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    1. Blanco, Maria & Cortignani, Raffaele & Severini, Simone, 2008. "Evaluating Changes in Cropping Patterns due to the 2003 CAP Reform. An Ex-post Analysis of Different PMP Approaches Considering New Activities," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6674, European Association of Agricultural Economists.
    2. Berbel, J. & Gomez-Limon, J. A., 2000. "The impact of water-pricing policy in Spain: an analysis of three irrigated areas," Agricultural Water Management, Elsevier, vol. 43(2), pages 219-238, March.
    3. Thomas Heckelei & Hendrik Wolff, 2003. "Estimation of constrained optimisation models for agricultural supply analysis based on generalised maximum entropy," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 30(1), pages 27-50, March.
    4. Gómez-Limón, José A. & Sanchez-Fernandez, Gabriela, 2010. "Empirical evaluation of agricultural sustainability using composite indicators," Ecological Economics, Elsevier, vol. 69(5), pages 1062-1075, March.
    5. Quirino Paris & Richard E. Howitt, 1998. "An Analysis of Ill-Posed Production Problems Using Maximum Entropy," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 124-138.
    6. Oliver Balkhausen & Martin Banse & Harald Grethe, 2008. "Modelling CAP Decoupling in the EU: A Comparison of Selected Simulation Models and Results," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 57-71, 02.
    7. Arfini, Filippo & Donati, Michele, 2008. "Health Check And Farm Efficiency: A Comparative Assessment Of Four European Agricultural Regions," 109th Seminar, November 20-21, 2008, Viterbo, Italy 44785, European Association of Agricultural Economists.
    8. Golan, Amos & Judge, George G. & Miller, Douglas, 1996. "Maximum Entropy Econometrics," Staff General Research Papers 1488, Iowa State University, Department of Economics.
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