The Agricultural Income and the Process ojMac Sharry Rejorm

The impact ojMac Sharry rejorm on EU agriculture, jully implemented since 1996, has not been evaluated yet. The rejorm process has continued, mainly on the same guidelines, with Agenda 2000 and it is still going on with the so called Mid Term Review. This is why an evaluation ojthe effects ojthe various measures included in the rejorm is particularly needed. The paper provides an overall evaluation ojthe extent to which the announced targets ojthe Mac Sharry rejorm have been achieved in terms ojproduction reduction, promotion ojmore environmental jriendly production techniques, andjarmers' income supporto The analysis perjormed is ojan ex-post nature, and covers ali EU countries. Major results indicates that: 1) agricultural income decreased slightly due 60th to the standstill oj agricultural output prices, and to injlation, that has been affecting the purchasing power oj income and the real value oj direct payments; 2) there is a difJerentiation among countries in the role oj direct aid in preserving agricultural income; 3) production has increased, together with land productivity; 4) use oj chemicals has increased as well; 5) the long term trend ojreduction ojagricultural land has decreased due to the rent effect ojdirect payments per hectare.