IDEAS home Printed from https://ideas.repec.org/a/ags/gazdal/141149.html
   My bibliography  Save this article

The Common Agricultural Policy In Relation To Institutional Economics

Author

Listed:
  • Vasary, Viktoria

Abstract

The EU’s Common Agricultural Policy (CAP) boasts such a unique system of aims and tools that it assumes and requires the presence of a serious, national institutional background for its implementation. However, if the necessary tools cannot – or can only partly – be utilised, due to an inadequate institutional framework, this endangers the achievement of the proposed aims. The agricultural policy can, therefore, only be fully executed within the appropriate institutional system. It is an important task to independently analyse the functioning of key elements of the EAGGF Guarantee Payments system responsible for a significant proportion of support: the Payment Agency, and the Integrated Administration and Control System, which is necessary for managing the predominantly direct payments from the Guarantee Department. Beyond this it is necessary that both should be studied in a wider context, in terms of the new institutional economics that draws attention to information deficiencies and transaction costs. The asymmetric nature of the information provided to Member States’ governments in relation to performing their delegated, payment-related tasks, requires a high level of monitoring, control and enforcement by Community institutions and the Commission. The deficiencies of shared management, which characterise the CAP may be seen as problems to be faced by both Old and New Member States and which can be handled by means of the principal-agent model. Regarding transaction costs our attention should primarily focus on policy-related transaction costs. This issue has been gaining in importance in the case of the ever-changing CAP of the past 13 years. One significant question is whether in the course of a given policy amendment the implementation of new measures will cost more or less than the previous ones, while another is where to set the trade-off between costs and precision (targeting).

Suggested Citation

  • Vasary, Viktoria, 2006. "The Common Agricultural Policy In Relation To Institutional Economics," GAZDà LKODà S: Scientific Journal on Agricultural Economics, Kà ROLY RÓBERT OKTATÓ-KUTATÓ Kht., vol. 50(17).
  • Handle: RePEc:ags:gazdal:141149
    as

    Download full text from publisher

    File URL: http://purl.umn.edu/141149
    Download Restriction: no

    References listed on IDEAS

    as
    1. Pasquale Tridico, 2006. "Institutional Change and Governance Indexes in Transition Economies: the case of Poland," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 3(2), pages 197-238, December.
    Full references (including those not matched with items on IDEAS)

    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:gazdal:141149. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search). General contact details of provider: http://www.gazdalkodas.hu/ .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.