IDEAS home Printed from https://ideas.repec.org/p/ags/iaae15/211542.html
   My bibliography  Save this paper

The Impact of Crop Diversification Measure: EU-wide Evidence Based on IFM-CAP Model

Author

Listed:
  • Louhichi, Kamel
  • Ciaian, Pavel
  • Espinosa, Maria
  • Colen, Liesbeth
  • Perni, Angel
  • Paloma, Sergio

Abstract

This paper presents simulation results of crop diversification measure adopted as part of the CAP greening within the 2013 CAP reform. The simulations are performed using the EU-wide individual farm-based model for CAP analysis (IFM-CAP). The IFM-CAP model is a static positive mathematical programming model builds on the EU-FADN (Farm Accountancy Data Network) data. The model is calibrated to the FADN farm constant sample for 2007- 2009 representing around 60,500 individual farms. The advantage of this model relative to existing models is that it captures the full heterogeneity of the EU farm population and covering all Member States. Results show that most farms choose to increase their compliance with the diversification measure owing to the sizable subsidy reduction imposed in case of non-compliance. However, the overall impact on farm income is rather limited: farm income decreases by less than 1% at EU level, and only 5% of the farm population will be negatively affected. Nevertheless, for a small number of farms the income effect could be more substantial (more than -10%).

Suggested Citation

  • Louhichi, Kamel & Ciaian, Pavel & Espinosa, Maria & Colen, Liesbeth & Perni, Angel & Paloma, Sergio, 2015. "The Impact of Crop Diversification Measure: EU-wide Evidence Based on IFM-CAP Model," 2015 Conference, August 9-14, 2015, Milan, Italy 211542, International Association of Agricultural Economists.
    • Handle: RePEc:ags:iaae15:211542
    DOI: 10.22004/ag.econ.211542
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/211542/files/Louhichi_et_al_1_.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.211542?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Heinrich, Barbara, 2012. "Calculating the 'greening' effect: A case study approach to predict the gross margin losses in different farm types in Germany due to the reform of the CAP," DARE Discussion Papers 1205, Georg-August University of Göttingen, Department of Agricultural Economics and Rural Development (DARE).
    2. Heinrich, Barbara, 2012. "Calculating The ‘Greening’ Effect: A Case Study Approach To Predict The Gross Margin Losses In Different Farm Types In Germany Due To The Reform Of The Cap," Department of Agricultural and Rural Development (DARE) Discussion Papers 187445, Georg-August-Universitaet Goettingen, Department of Agricultural Economics and Rural Development (DARE).
    3. Lauriane Mouysset, 2014. "Agricultural public policy: Green or sustainable?," Post-Print hal-01565879, HAL.
    4. Louhichi, Kamel & Kanellopoulos, Argyris & Janssen, Sander & Flichman, Guillermo & Blanco, Maria & Hengsdijk, Huib & Heckelei, Thomas & Berentsen, Paul & Lansink, Alfons Oude & Ittersum, Martin Van, 2010. "FSSIM, a bio-economic farm model for simulating the response of EU farming systems to agricultural and environmental policies," Agricultural Systems, Elsevier, vol. 103(8), pages 585-597, October.
    5. Gibbons, James M. & Sparkes, Debbie L. & Wilson, Paul & Ramsden, Stephen J., 2005. "Modelling optimal strategies for decreasing nitrate loss with variation in weather - a farm-level approach," Agricultural Systems, Elsevier, vol. 83(2), pages 113-134, February.
    6. 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 and the European Agricultural and Applied Economics Publications Foundation, vol. 30(1), pages 27-50, March.
    7. Heckelei, Thomas & Britz, Wolfgang, 2000. "Positive Mathematical Programming with Multiple Data Points: A Cross-Sectional Estimation Procedure," Cahiers d'Economie et de Sociologie Rurales (CESR), Institut National de la Recherche Agronomique (INRA), vol. 57.
    8. Heckelei, Thomas & Britz, Wolfgang & Zhang, Yinan, 2012. "Positive Mathematical Programming Approaches – Recent Developments in Literature and Applied Modelling," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 1(1), pages 1-16, April.
    9. Mahy, Louis & Dupeux, Bérénice & Van Huylenbroeck, Guido & Buysse, Jeroen, 2014. "Simulating Farm Level Response To Crop Diversification Policy," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182797, European Association of Agricultural Economists.
    10. Heckelei, Thomas & Mittelhammer, Ronald C. & Jansson, Torbjorn, 2008. "A Bayesian Alternative To Generalized Cross Entropy Solutions For Underdetermined Econometric Models," Discussion Papers 56973, University of Bonn, Institute for Food and Resource Economics.
    11. Kamel Louhichi & Pavel Ciaian & Maria Espinosa & Liesbeth Colen & Angel Perni & Sergio Gomez y Paloma, 2015. "Individual Farm Model for Common Agricultural Policy Analysis (IFM-CAP)," JRC Research Reports JRC92574, Joint Research Centre.
    12. Fragoso, R. & Marques, C. & Lucas, M.R. & Martins, M.B. & Jorge, R., 2011. "The economic effects of common agricultural policy on Mediterranean montado/dehesa ecosystem," Journal of Policy Modeling, Elsevier, vol. 33(2), pages 311-327, March.
    13. Moro, Daniele & Sckokai, Paolo, 2013. "The impact of decoupled payments on farm choices: Conceptual and methodological challenges," Food Policy, Elsevier, vol. 41(C), pages 28-38.
    14. Heinrich, Barbara, 2012. "Calculating The ‘Greening’ Effect: A Case Study Approach To Predict The Gross Margin Losses In Different Farm Types In Germany Due To The Reform Of The Cap," 54th Annual Conference, Goettingen, Germany, September 17-19, 2014 187445, German Association of Agricultural Economists (GEWISOLA).
    15. Pierre Mérel & Santiago Bucaram, 2010. "Exact calibration of programming models of agricultural supply against exogenous supply elasticities," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 37(3), pages 395-418, September.
    16. Bruno Henry Frahan & Jeroen Buysse & Philippe Polomé & Bruno Fernagut & Olivier Harmignie & Ludwig Lauwers & Guido Huylenbroeck & Jef Meensel, 2007. "Positive Mathematical Programming for Agricultural and Environmental Policy Analysis: Review and Practice," International Series in Operations Research & Management Science, in: Andres Weintraub & Carlos Romero & Trond Bjørndal & Rafael Epstein & Jaime Miranda (ed.), Handbook Of Operations Research In Natural Resources, chapter 0, pages 129-154, Springer.
    17. Basil Manos & Thomas Bournaris & Christina Moulogianni & Fedra Kiomourtzi, 2017. "Assessment of rural development plan measures in Greece," International Journal of Operational Research, Inderscience Enterprises Ltd, vol. 28(4), pages 448-471.
    18. Gocht, Alexander & Britz, Wolfgang, 2011. "EU-wide farm type supply models in CAPRI--How to consistently disaggregate sector models into farm type models," Journal of Policy Modeling, Elsevier, vol. 33(1), pages 146-167, January.
    19. Mouysset, L., 2014. "Agricultural public policy: Green or sustainable?," Ecological Economics, Elsevier, vol. 102(C), pages 15-23.
    20. Paris,Quirino, 2011. "Economic Foundations of Symmetric Programming," Cambridge Books, Cambridge University Press, number 9780521123020.
    21. Heinrich, Barbara, 2012. "Calculating The ‘Greening’ Effect – A Case Study Approach To Estimate The Gross Margin Losses In Different Farm Types In Germany Due To The Reform Of The Cap," 52nd Annual Conference, Stuttgart, Germany, September 26-28, 2012 137155, German Association of Agricultural Economists (GEWISOLA).
    22. Lansink, Alfons Oude & Peerlings, Jack, 1996. "Modelling the New EU Cereals and Oilseeds Regime in the Netherlands," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 23(2), pages 161-178.
    23. Pierre Mérel & Leo K. Simon & Fujin Yi, 2011. "A Fully Calibrated Generalized Constant-Elasticity-of-Substitution Programming Model of Agricultural Supply," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 93(4), pages 936-948.
    24. Cortignani, Raffaele & Severini, Simone, 2009. "Modeling farm-level adoption of deficit irrigation using Positive Mathematical Programming," Agricultural Water Management, Elsevier, vol. 96(12), pages 1785-1791, December.
    25. Paris,Quirino, 2011. "Economic Foundations of Symmetric Programming," Cambridge Books, Cambridge University Press, number 9780521194723.
    26. Paolo Sckokai & Daniele Moro, 2006. "Modeling the Reforms of the Common Agricultural Policy for Arable Crops under Uncertainty," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(1), pages 43-56.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Roberto Cagliero & Francesco Licciardo & Marzia Legnini, 2021. "The Evaluation Framework in the New CAP 2023–2027: A Reflection in the Light of Lessons Learned from Rural Development," Sustainability, MDPI, vol. 13(10), pages 1-18, May.
    2. Alexander Gocht & Pavel Ciaian & Maria Bielza & Jean-Michel Terres & Norbert Röder & Mihaly Himics & Guna Salputra, 2017. "EU-wide Economic and Environmental Impacts of CAP Greening with High Spatial and Farm-type Detail," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(3), pages 651-681, September.
    3. Alexander Gocht & Pavel Ciaian & Maria Bielza & Jean-Michel Terres & Norbert Röder & Mihaly Himics & Guna Salputra, 2016. "Economic and environmental impacts of CAP greening: CAPRI simulation results," JRC Research Reports JRC102519, Joint Research Centre.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Louhichi, Kamel & Ciaian, Pavel & Espinosa, Maria & Colen, Liesbeth & Perni, Angel & Gomez y Paloma, Sergio, 2015. "EU-wide individual Farm Model for CAP Analysis (IFM-CAP): Application to Crop Diversification Policy," 2015 Conference, August 9-14, 2015, Milan, Italy 212155, International Association of Agricultural Economists.
    2. Louhichi, Kamel & Ciaian, Pavel & Espinosa, Maria & Colen, Liesbeth & Perni, Angel & Gomez y Paloma, Sergio, 2015. "Farm-level economic impacts of EU-CAP greening measures," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 205309, Agricultural and Applied Economics Association.
    3. Kamel Louhichi & Pavel Ciaian & Maria Espinosa & Angel Perni & Sergio Gomez y Paloma, 2018. "Economic impacts of CAP greening: application of an EU-wide individual farm model for CAP analysis (IFM-CAP)," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 45(2), pages 205-238.
    4. Kamel Elouhichi & Maria Espinosa Goded & Pavel Ciaian & Angel Perni Llorente & Bouda Vosough Ahmadi & Liesbeth Colen & Sergio Gomez Y Paloma, 2018. "The EU-Wide Individual Farm Model for Common Agricultural Policy Analysis (IFM-CAP v.1): Economic Impacts of CAP Greening," JRC Research Reports JRC108693, Joint Research Centre.
    5. Solazzo, Roberto & Pierangeli, Fabio, 2016. "How does greening affect farm behaviour? Trade-off between commitments and sanctions in the Northern Italy," Agricultural Systems, Elsevier, vol. 149(C), pages 88-98.
    6. Pascal Tillie & Kamel Louhichi & Sergio Gomez-Y-Paloma, 2018. "La culture attelée dans le bassin cotonnier en Côte d'Ivoire. Analyse et modélisation des impacts d'un programme de relance de la culture attelée," JRC Research Reports JRC111027, Joint Research Centre.
    7. Viaggi, Davide & Raggi, Meri & Gomez y Paloma, Sergio, 2011. "Farm-household investment behaviour and the CAP decoupling: Methodological issues in assessing policy impacts," Journal of Policy Modeling, Elsevier, vol. 33(1), pages 127-145, January.
    8. Alexander Gocht & Pavel Ciaian & Maria Bielza & Jean-Michel Terres & Norbert Röder & Mihaly Himics & Guna Salputra, 2017. "EU-wide Economic and Environmental Impacts of CAP Greening with High Spatial and Farm-type Detail," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(3), pages 651-681, September.
    9. Liu, Xuan & van Kooten, Gerrit Cornelis & Duan, Jun, 2020. "Calibration of agricultural risk programming models using positive mathematical programming," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(3), July.
    10. Kamel Elouhichi & Pascal Tillie & Aymeric Ricome & Sergio Gomez-Y-Paloma, 2020. "Modelling Farm-household Livelihoods in Developing Economies: Insights from three country case studies using LSMS-ISA data," JRC Research Reports JRC118822, Joint Research Centre.
    11. Athanasios Petsakos & Stelios Rozakis, 2022. "Models and muddles: comment on ‘Calibration of agricultural risk programming models using positive mathematical programming’," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(3), pages 713-728, July.
    12. Kamel Louhichi & Pascal Tillie & Aymeric Ricome & Sergio Gomez y Paloma, 2020. "Modelling Farm-household Livelihoods in Developing Economies Insights from three country case studies using LSMS-ISA data [Modélisation des moyens de subsistance des ménages agricoles dans les écon," Post-Print hal-02544905, HAL.
    13. Siwa Msangi & Sarah Ann Cline, 2016. "Improving Groundwater Management for Indian Agriculture: Assessing Tradeoffs Across Policy Instruments," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(03), pages 1-33, September.
    14. Heckelei, Thomas & Britz, Wolfgang & Zhang, Yinan, 2012. "Positive Mathematical Programming Approaches – Recent Developments in Literature and Applied Modelling," Bio-based and Applied Economics Journal, Italian Association of Agricultural and Applied Economics (AIEAA), vol. 1(1), pages 1-16, April.
    15. Britz, Wolfgang & Linda, Arata, "undated". "How Important Are Crop Shares In Managing Risk For Specialized Arable Farms? A Panel Estimation Of A Programming Model For Three European Regions," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 244801, German Association of Agricultural Economists (GEWISOLA).
    16. Umed Temurshoev & Marian Mraz & Luis Delgado Sancho & Peter Eder, 2015. "EU Petroleum Refining Fitness Check: OURSE Modelling and Results," JRC Research Reports JRC96207, Joint Research Centre.
    17. Umed Temurshoev & Fréderic Lantz, 2016. "Long-term petroleum product supply analysis through a robust modelling approach," Working Papers 2016-003, Universidad Loyola Andalucía, Department of Economics.
    18. Kooten, G. Cornelis van, 2013. "Modeling Forest Trade in Logs and Lumber: Qualitative and Quantitative Analysis," Working Papers 149182, University of Victoria, Resource Economics and Policy.
    19. CARPENTIER, Alain & GOHIN, Alexandre & SCKOKAI, Paolo & THOMAS, Alban, 2015. "Economic modelling of agricultural production: past advances and new challenges," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement (RAEStud), Institut National de la Recherche Agronomique (INRA), vol. 96(1), March.
    20. Koutchade, Philippe & Carpentier, Alain & Féménia, Fabienne, 2015. "Empirical modeling of production decisions of heterogeneous farmers with random parameter models," Working Papers 210097, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).

    More about this item

    Keywords

    Crop Production/Industries; Environmental Economics and Policy;

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:iaae15:211542. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/iaaeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.