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Assessing the impact of the EU Common Agricultural Policy pillar II support using micro-economic data

Author

Listed:
  • Buysse, Jeroen
  • Verspecht, Ann
  • Van Huylenbroeck, Guido

Abstract

The paper uses the case of Flemish investment support to make a quantitative analysis of pillar II support based on micro-economic data from the FADN and the administrative dataset of the investment support fund. A dynamic panel estimation quantifies the effect of support for settingup young farmers, structural investment support and support for investments on farm diversification, animal welfare or environmental investments.. The results show that investment support for farm diversification and structural support increase the total output and the income. Environmental investment support increase costs and decrease the farm income without a significant impact on output. The conclusion for the national debate is that the structural and the diversification investment support is effective while the environmental investment support is too low to cover all additional costs in the short run. The conclusion for the international debate is that, except for the structural investment support, the Flemish investment support is not distortive for international agricultural markets.

Suggested Citation

  • Buysse, Jeroen & Verspecht, Ann & Van Huylenbroeck, Guido, 2011. "Assessing the impact of the EU Common Agricultural Policy pillar II support using micro-economic data," 122nd Seminar, February 17-18, 2011, Ancona, Italy 99596, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaa122:99596
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    File URL: http://purl.umn.edu/99596
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    Keywords

    Pillar II; Investment support; decoupled subsidies; dynamic panel estimation; Flanders; Agricultural and Food Policy; Q12; Q18; Q51; Q52.;

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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