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Economic and environmental effects of an EU flat rate for the Dutch agricultural sector

Author

Listed:
  • Helming, John F.M.
  • Peerlings, Jack H.M.

Abstract

The objective of this research is to give insights into the production, income and environmental effects of the introduction of an EU flat rate for Dutch agriculture. For this purpose, a detailed agri-environmental programming model for Dutch agriculture is used. Results of the EU flat rate scenario are compared to a reference scenario that describes agricultural production in the Netherlands in 2020. Results show that total gross margin in Dutch agriculture decreases because of the EU flat rate with 7%. The supply of starch potatoes and cow milk decreases most. Production of seed and consumption potatoes, vegetables and intensive livestock products increases slightly. This is largely due to a shift of farm payments from milk and starch potatoes production to arable crops and vegetable production. It was found that including risk aversion of income volatility amplifies these effects. The flat rate decreases the total emissions of nutrients to the environment from agricultural production.

Suggested Citation

  • Helming, John F.M. & Peerlings, Jack H.M., 2012. "Economic and environmental effects of an EU flat rate for the Dutch agricultural sector," 123rd Seminar, February 23-24, 2012, Dublin, Ireland 122481, European Association of Agricultural Economists.
  • Handle: RePEc:ags:eaa123:122481
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    File URL: http://purl.umn.edu/122481
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    References listed on IDEAS

    as
    1. Alexander Gocht & Wolfgang Britz & Marcel Adenäuer & Pavel Ciaian & Sergio Gomez y Paloma, 2011. "Farm level policy scenario analysis," JRC Working Papers JRC64334, Joint Research Centre (Seville site).
    2. Oliver Balkhausen & Martin Banse & Harald Grethe, 2008. "Modelling CAP Decoupling in the EU: A Comparison of Selected Simulation Models and Results," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 57-71, February.
    3. Thia Hennessy & Shailesh Shrestha & Stephen Hynes, 2006. "The Effect of Decoupling on Farming in Ireland: A Regional Analysis," Working Papers 0611, Rural Economy and Development Programme,Teagasc.
    4. Britz, Wolfgang & Heckelei, Thomas & Perez Dominguez, Ignacio, 2006. "Effects of decoupling on land use: an EU wide, regionally differentiated analysis," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 55(5/6).
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    EU flat rate; mathematical programming; income volatility; Agricultural and Food Policy; Risk and Uncertainty; Q1; D8;

    JEL classification:

    • Q1 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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