IDEAS home Printed from https://ideas.repec.org/p/ucd/wpaper/202103.html
   My bibliography  Save this paper

Alternative EU CAP Tools for Stabilising Farm Incomes in the Era of Climate Change

Author

Listed:
  • Ole Boysen

    (School of Agriculture & Food Science and Geary Institute for Public Policy, University College Dublin)

  • Kirsten Boysen-Urban

    (Department of International Agricultural Trade & Food Security, University of Hohenheim)

  • Alan Matthews

    (Department of Economics, Trinity College Dublin)

Abstract

No reliable supports protect EU farmers from the catastrophic risks which are expected to increase in frequency and severity due to climate change. We propose three transparent, predictable, and fair safety net policies which operate with indices on the Member State level. Simulations with a tailored global model of a series of historic yield shocks as observed over past decades serve as a test bed to quantify the costs and benefits of these policies in EU Member States using various risk metrics. The results highlight properties of and rankings among these polices useful for guiding future policy design and assessment.

Suggested Citation

  • Ole Boysen & Kirsten Boysen-Urban & Alan Matthews, 2021. "Alternative EU CAP Tools for Stabilising Farm Incomes in the Era of Climate Change," Working Papers 202103, Geary Institute, University College Dublin.
    • Handle: RePEc:ucd:wpaper:202103
    as

    Download full text from publisher

    File URL: http://www.ucd.ie/geary/static/publications/workingpapers/gearywp202103.pdf
    File Function: First version, 2021
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Zeileis, Achim & Leisch, Friedrich & Hornik, Kurt & Kleiber, Christian, 2002. "strucchange: An R Package for Testing for Structural Change in Linear Regression Models," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 7(i02).
    2. Zeileis, Achim & Kleiber, Christian & Kramer, Walter & Hornik, Kurt, 2003. "Testing and dating of structural changes in practice," Computational Statistics & Data Analysis, Elsevier, vol. 44(1-2), pages 109-123, October.
    3. Femenia, Fabienne, 2010. "Impacts of Stockholding Behaviour on Agricultural Market Volatility: A Dynamic Computable General Equilibrium Approach," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 59(3).
    4. Malcolm, Gerard, 1998. "Adjusting Tax Rates In The Gtap Data Base," Technical Papers 28721, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Jean Cordier & Fabio Santeramo, 2020. "Mutual Funds and the Income Stabilisation Tool in the EU: Retrospect and Prospects," EuroChoices, The Agricultural Economics Society, vol. 19(1), pages 53-58, April.
    6. Alexandre Gohin, 2019. "General Equilibrium Modelling of the Insurance Industry: U.S. Crop Insurance," Journal of Global Economic Analysis, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, vol. 4(2), pages 108-145, December.
    7. Marcel van Asseldonk & Roel Jongeneel & G. Cornelis van Kooten & Jean Cordier, 2019. "Agricultural Risk Management in the European Union: A Proposal to Facilitate Precautionary Savings," EuroChoices, The Agricultural Economics Society, vol. 18(2), pages 40-46, August.
    8. Mekbib G. Haile & Tesfamicheal Wossen & Kindie Tesfaye & Joachim von Braun, 2017. "Impact of Climate Change, Weather Extremes, and Price Risk on Global Food Supply," Economics of Disasters and Climate Change, Springer, vol. 1(1), pages 55-75, June.
    9. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
    10. Keith Walsh & Martina Brockmeier & Alan Matthews, 2005. "Implications of Domestic Support Disciplines for Further Agricultural Trade Liberalization," The Institute for International Integration Studies Discussion Paper Series iiisdp99, IIIS.
    11. Hertel, Thomas W. & Reimer, Jeffrey J. & Valenzuela, Ernesto, 2005. "Incorporating commodity stockholding into a general equilibrium model of the global economy," Economic Modelling, Elsevier, vol. 22(4), pages 646-664, July.
    12. Alexandre Gohin, 2019. "General Equilibrium Modelling of the Insurance Industry: U.S. Crop Insurance," Post-Print hal-02911590, HAL.
    13. Boulanger, Pierre & Philippidis, George, 2015. "The EU budget battle: Assessing the trade and welfare impacts of CAP budgetary reform," Food Policy, Elsevier, vol. 51(C), pages 119-130.
    14. Malcolm, Gerard, 1998. "Adjusting Tax Rates in the GTAP Data Base," GTAP Technical Papers 315, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    15. Femenia, Fabienne, 2010. "Impacts of Stockholding Behaviour on Agricultural Market Volatility: A Dynamic Computable General Equilibrium Approach," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 59(03), pages 1-15, September.
    16. Urban, Kirsten & Hans Grinsted Jensen & Martina Brockmeier, 2014. "Extending the GTAP Data Base and Model to Cover Domestic Support Issues using the EU as Example," GTAP Technical Papers 4569, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    17. Urban, Kirsten & Jensen, Hans G. & Brockmeier, Martina, 2016. "How decoupled is the Single Farm Payment and does it matter for international trade?," Food Policy, Elsevier, vol. 59(C), pages 126-138.
    18. Ole Boysen & Ana Corina Miller & Alan Matthews, 2016. "Economic and Household Impacts of Projected Policy Changes for the Irish Agri-food Sector," Journal of Agricultural Economics, Wiley Blackwell, vol. 67(1), pages 105-129, February.
    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. Stéphanie Barral, 2023. "Risk management in the Common Agricultural Policy: the promises of data and finance in the face of increasing hazards," Review of Agricultural, Food and Environmental Studies, Springer, vol. 104(1), pages 67-76, March.

    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. Ole Boysen & Kirsten Boysen‐Urban & Alan Matthews, 2023. "Stabilizing European Union farm incomes in the era of climate change," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 45(3), pages 1634-1658, September.
    2. Boysen-Urban, Kirsten & Boysen, Ole & Matthews, Alan & Brockmeier, Martina, 2018. "EU Common Agricultural Policy Post-2020: Exploring the Effects of Safety-Net Policy Instruments," Conference papers 332991, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    3. Flaig, Dorothee & Boysen-Urban, Kirsten, 2019. "EU Agricultural Domestic Support in Global Value Chains or Where Does the Money Go?," Conference papers 333054, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Pierre Boulanger & Kirsten Boysen-Urban & George Philippidis, 2021. "European Union Agricultural Support ‘Coupling’ in Simulation Modelling: Measuring the Sustainability Impacts," Sustainability, MDPI, vol. 13(6), pages 1-17, March.
    5. Ianchovichina, Elena, 2004. "Trade policy analysis in the presence of duty drawbacks," Journal of Policy Modeling, Elsevier, vol. 26(3), pages 353-371, April.
    6. Laborde, David & Martin, Will & van der Mensbrugghe, Dominique, 2008. "Implications of the 2008 Doha Draft Agricultural and NAMA Market Access Modalities for Developing Countries," Conference papers 331719, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    7. Balie, Jean & Strutt, Anna & Nelgen, Signe & Narayanan, 2018. "Infrastructure investments for improved market access in subSaharan Africa: A CGE analysis," African Journal of Agricultural and Resource Economics, African Association of Agricultural Economists, vol. 13(2), June.
    8. Hertel, Thomas & Hummels, David & Ivanic, Maros & Keeney, Roman, 2007. "How confident can we be of CGE-based assessments of Free Trade Agreements?," Economic Modelling, Elsevier, vol. 24(4), pages 611-635, July.
    9. Horridge, Mark & Ferreira-Filho, Joaquim Bento de Souza, 2003. "Linking GTAP to National Models: Some Highlights and a Practical Approach," Conference papers 331115, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    10. Peter Walkenhorst & Tadashi Yasui, 2004. "Quantitative Assessment of the Benefits of Trade Facilitation," International Trade 0401008, University Library of Munich, Germany.
    11. Soo Yuen Chong & Jung Hur, 2007. "Overlapping Free Trade Agreements of Singapore-USA-Japan : A Computational Analysis," Trade Working Papers 21931, East Asian Bureau of Economic Research.
    12. Gehlhar, Mark & Wainio, John, 2004. "Feasibility of Reducing Agricultural Protection: Implications for Farm Households," Conference papers 331293, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    13. De Miguel, Carlos J. & Durán Lima, José Elías & Schuschny, Andrés Ricardo, 2007. "Los acuerdos comerciales de Colombia, Ecuador y Perú con los Estados Unidos: efectos sobre el comercio, la producción y el bienestar," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    14. Wusheng Yu & Hans G. Jensen, 2010. "China’s Agricultural Policy Transition: Impacts of Recent Reforms and Future Scenarios," Journal of Agricultural Economics, Wiley Blackwell, vol. 61(2), pages 343-368, June.
    15. Anderson, Kym & Valenzuela, Ernesto & van der Mensbrugghe, Dominique, 2009. "Welfare and Poverty Effects of Global Agricultural and Trade Policies Using the Linkage Model," Agricultural Distortions Working Paper Series 52785, World Bank.
    16. Hans G. Jensen & Kym Anderson, 2017. "Grain Price Spikes and Beggar-thy-Neighbor Policy Responses: A Global Economywide Analysis," The World Bank Economic Review, World Bank, vol. 31(1), pages 158-175.
    17. Scott McDonald & Terrie Walmsley, 2008. "Bilateral Free Trade Agreements and Customs Unions: The Impact of the EU Republic of South Africa Free Trade Agreement on Botswana," The World Economy, Wiley Blackwell, vol. 31(8), pages 993-1029, August.
    18. Cristina Cattaneo, 2008. "The Determinants of Actual Migration and the Role of Wages and Unemployment in Albania: an Empirical Analysis," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 5(1), pages 3-32, June.
    19. Evans, David & Gasiorek, Michael & McDonald, Scott & Robinson, Sherman, 2006. "Trade Liberalisation with Trade Induced Technical Change in Morocco and Egypt: Findings and Wider Research Implications," Conference papers 331529, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    20. De Miguel, Carlos J. & Durán Lima, José Elías & Schuschny, Andrés Ricardo, 2007. "Trade agreements by Colombia, Ecuador and Peru with the United States: effects on trade, production and welfare," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.

    More about this item

    Keywords

    Safety nets; risk management; income stabilisation; climate change; EU Common Agricultural Policy;
    All these keywords.

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

    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:ucd:wpaper:202103. 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: Geary Tech (email available below). General contact details of provider: https://edirc.repec.org/data/geucdie.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.