An impact assessment of EU's CAP income stabilisation payments
To help farmers cope with increased income volatility, the EU may be introducing a farm income stabilisation payment in the post-2013 CAP. This payment would generally cover dramatic risk exceptionally leading to more than 30 per cent of income losses. This paper applies a model for a risk-averse farm producer facing output price, yield and policy uncertainty, to examine the impacts of the potential implementation of such payments in French crop specialist farms. The proposed scheme reduces farm income volatility, after 5 and 10 years, respectively by 2.08% and 1.19%. Interestingly, the proposed scheme reduces volatility in farm investments by about 11.45% after 5 years.
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- Paolo Sckokai & Daniele Moro, 2009. "Modelling the impact of the CAP Single Farm Payment on farm investment and output," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 36(3), pages 395-423, September.
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Staff General Research Papers
12851, Iowa State University, Department of Economics.
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