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Ex-Ante Analysis of the Regional Impacts of the Common Agricultural Policy: A Rural-Urban Recursive Dynamic CGE Model Approach

Author

Listed:
  • Maria Espinosa
  • Demetrios Psaltopoulos
  • Fabien Santini
  • Euan Phimister
  • Deborah Roberts
  • Sebastien Mary
  • Tomas Ratinger
  • Dimitris Skuras
  • Eudokia Balamou
  • Manuel A. Cardenete
  • Sergio Gomez y Paloma

Abstract

A recursive dynamic regional Computable General Equilibrium model is developed to assess the economic impacts of two Common Agricultural Policy (CAP) scenarios in six NUTS-3 (Nomenclature of Territorial Units for Statistics) (NUTS-1: major socio-economic regions, NUTS-2: basic regions for the application of regional policies, NUTS-3: small regions for specific diagnoses) regions of the European Union (EU). The main goal of the analysis is to assess the scenario effects (change in production, prices, income, employment) in the rural and urban parts of these regions as well as on the different sectors. The two scenarios analysed are related to a 30% reduction in Pillar 1 (market measures and direct support to farmers) support and the introduction of an EU-wide flat rate level of Pillar 1 support complemented by a 45% increase in Pillar 2 (Rural Development Policy) funds. Results show that the overall gross domestic product effects are not significant, due to the relatively low importance of both the agricultural sector and CAP spending in the regional economies. However, impacts on the agricultural sector are quite important and differ according to the nature of the policy shock. Also, the structural characteristics of each case study influence the rural-urban and sectoral spillovers, including impacts on region-specific agricultural activity.

Suggested Citation

  • Maria Espinosa & Demetrios Psaltopoulos & Fabien Santini & Euan Phimister & Deborah Roberts & Sebastien Mary & Tomas Ratinger & Dimitris Skuras & Eudokia Balamou & Manuel A. Cardenete & Sergio Gomez y, 2014. "Ex-Ante Analysis of the Regional Impacts of the Common Agricultural Policy: A Rural-Urban Recursive Dynamic CGE Model Approach," European Planning Studies, Taylor & Francis Journals, vol. 22(7), pages 1342-1367, July.
  • Handle: RePEc:taf:eurpls:v:22:y:2014:i:7:p:1342-1367
    DOI: 10.1080/09654313.2013.786683
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    Citations

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    Cited by:

    1. Gohin, Alexandre & Zheng, Yu, 2020. "Reforming the European Common Agricultural Policy: From price & income support to risk management," Journal of Policy Modeling, Elsevier, vol. 42(3), pages 712-727.
    2. Gohin, Alexandre & Zheng, Yu, 2015. "Assessing the Market Impacts of the Common Agricultural Policy: Does Farmers’ Risk Attitude Matter?," 2015: Trade and Societal Well-Being, December 13-15, 2015, Clearwater Beach, Florida 229235, International Agricultural Trade Research Consortium.
    3. Alexandre Gohin & Yu Zheng, 2016. "Assessing the Market Impacts of the Common Agricultural Policy: Does Farmers' Risk Attitude Matter?," FOODSECURE Working papers 46, LEI Wageningen UR.
    4. Sébastien Mary & Euan Phimister & Deborah Roberts & Fabien Santini, 2013. "Testing the sensitivity of CGE results: A Monte Carlo Filtering approach to an application to rural development policies in Aberdeenshire," JRC Working Papers JRC85290, Joint Research Centre (Seville site).
    5. Konstantinos X. Soulis & Emmanouil Psomiadis & Paraskevi Londra & Dimitris Skuras, 2020. "A New Model-Based Approach for the Evaluation of the Net Contribution of the European Union Rural Development Program to the Reduction of Water Abstractions in Agriculture," Sustainability, MDPI, Open Access Journal, vol. 12(17), pages 1-25, September.
    6. Monsalve, Fabio & Zafrilla, Jorge Enrique & Cadarso, María-Ángeles, 2016. "Where have all the funds gone? Multiregional input-output analysis of the European Agricultural Fund for Rural Development," Ecological Economics, Elsevier, vol. 129(C), pages 62-71.

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