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Agricultural Subsidies and Rural Development

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  • Karine Daniel
  • Maureen Kilkenny

Abstract

How consistent is a single farm payment system with rural development goals? A new economic geography model is used to compare coupled subsidies to 'single farm payments' effects on the location of farming, agro-industry and non-farm activity between rural and urban areas. This abstract model features a majority of employment in service sectors, farming vertically linked to manufacturing, and strong preferences for geo-varieties. It appears that both coupled subsidies and single farm payments can decrease spatial agglomeration. But only the single farm payment policy raises welfare in both rural and urban regions of this stylised economy. Copyright (c) 2009 The Authors. Journal compilation (c) 2009 The Agricultural Economics Society.

Suggested Citation

  • Karine Daniel & Maureen Kilkenny, 2009. "Agricultural Subsidies and Rural Development," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(3), pages 504-529.
  • Handle: RePEc:bla:jageco:v:60:y:2009:i:3:p:504-529
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    References listed on IDEAS

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    Cited by:

    1. Stéphane De Cara & Anne Fournier & Carl Gaigné, 2011. "Feeding the cities and greenhouse gas emissions: a new economic geography approach," Working Papers 1109, Chaire Economie du climat.
    2. Maureen Kilkenny, 2010. "Urban/Regional Economics And Rural Development," Journal of Regional Science, Wiley Blackwell, vol. 50(1), pages 449-470.
    3. Hyytia, Nina, 2011. "Allocation of CAP modulation funds to rural development measures at the regional level in Finland," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114525, European Association of Agricultural Economists.
    4. Glover, Jane, 2011. "Where has all the cream gone: How sustainable is the English dairy supply chain?," 85th Annual Conference, April 18-20, 2011, Warwick University, Coventry, UK 108940, Agricultural Economics Society.
    5. V. Santoni & M. Pulina, 2016. "An analysis on the Italian agricultural firms: effects of public subsidies," Working Paper CRENoS 201611, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    6. G. Lindberg & P. Midmore & Y. Surry, 2012. "Agriculture’s Inter-industry Linkages, Aggregation Bias and Rural Policy Reforms," Journal of Agricultural Economics, Wiley Blackwell, vol. 63(3), pages 552-575, September.
    7. Jens Abildtrup & Virginie Piguet & Bertrand Schmitt, 2011. "The impact of agro-food industry on employment and population changes: The case of Denmark and France'," ERSA conference papers ersa10p1622, European Regional Science Association.
    8. Nina Hyytiä, 2014. "Farm diversification and regional investments: efficient instruments for the CAP rural development targets in rural regions of Finland?," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 41(2), pages 255-277.
    9. Hyytiä Nina, 2014. "Rural-Urban Multiplier and Policy Effects in Finish Rural Regions: an Inter-Regional Sam Analysis," European Countryside, De Gruyter Open, vol. 6(2), pages 1-23, June.
    10. Yves Schaeffer & Francis Aubert, 2010. "La pertinence de la politique rurale à l’aune des théories de la justice," Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, INRA Department of Economics, vol. 91(1), pages 73-101.

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