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Impacts of the European Biofuel Policy on the Farm Sector: A General Equilibrium Assessment

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  • Alexandre Gohin

Abstract

We assess the impacts of the European indicative biofuel policy on the farm sector with a farm-detailed computable general equilibrium model. Our simulations suggest that most of the biodiesel demand will be satisfied by imports while the bioethanol demand will be satisfied mostly by domestic production. We also show that the downstream livestock sectors are never negatively affected. Finally, the positive farm income effect is rather robust to our modeling assumptions: our central estimate is a 3.2 billion farm-income increase. However, the transfer efficiency of this policy is invariably limited. Copyright 2008, Oxford University Press.

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  • Alexandre Gohin, 2008. "Impacts of the European Biofuel Policy on the Farm Sector: A General Equilibrium Assessment," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 30(4), pages 623-641.
  • Handle: RePEc:oup:revage:v:30:y:2008:i:4:p:623-641
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    File URL: http://hdl.handle.net/10.1111/j.1467-9353.2008.00437.x
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    Cited by:

    1. Kim, In Seck & Binfield, Julian & Patton, Myles & Zhang, Lichun & Moss, Joan, 2013. "Impact of increasing liquid biofuel usage on EU and UK agriculture," Food Policy, Elsevier, vol. 38(C), pages 59-69.
    2. Sukati, Mphumuzi, 2014. "The South African Bio ethanol blend mandate and its implications on regional agricultural markets and welfare," MPRA Paper 57702, University Library of Munich, Germany.
    3. Ge, Jianping & Lei, Yalin & Tokunaga, Suminori, 2014. "Non-grain fuel ethanol expansion and its effects on food security: A computable general equilibrium analysis for China," Energy, Elsevier, vol. 65(C), pages 346-356.
    4. Hochman, Gal & Rajagopal, Deepak & Timilsina, Govinda & Zilberman, David, 2011. "The role of inventory adjustments in quantifying factors causing food price inflation," Policy Research Working Paper Series 5744, The World Bank.
    5. JunJie Wu & Christian Langpap, 2015. "The Price and Welfare Effects of Biofuel Mandates and Subsidies," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(1), pages 35-57, September.
    6. repec:bla:jageco:v:68:y:2017:i:3:p:839-860 is not listed on IDEAS
    7. Ji, Xi & Long, Xianling, 2016. "A review of the ecological and socioeconomic effects of biofuel and energy policy recommendations," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 41-52.
    8. Junker, Franziska & Wolf, Verena & Marquardt, Sandra & Ledebur, Oliver, 2015. "Changes to EU Biofuel Policy- Turmoil on Feedstock Markets," 2015 Conference, August 9-14, 2015, Milan, Italy 211819, International Association of Agricultural Economists.
    9. De Lucia, Caterina & Bartlett, Mark, 2014. "Implementing a biofuel economy in the EU: Lessons from the SUSTOIL project and future perspectives for next generation biofuels," Renewable and Sustainable Energy Reviews, Elsevier, vol. 29(C), pages 22-30.
    10. Deppermann, Andre & Offermann, Frank & Grethe, Harald, 2014. "Income effects of EU biofuel policies in Germany," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182803, European Association of Agricultural Economists.
    11. Deppermann, Andre & Offermann, Frank & Puttkammer, Judith & Grethe, Harald, 2016. "EU biofuel policies: Income effects and lobbying decisions in the German agricultural sector," Renewable Energy, Elsevier, vol. 87(P1), pages 259-265.
    12. Elizondo, Alejandra & Boyd, Roy, 2017. "Economic impact of ethanol promotion in Mexico: A general equilibrium analysis," Energy Policy, Elsevier, vol. 101(C), pages 293-301.

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