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Policy Changes and Modelling Challenges: Insights from PEM Analysis

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  • Martini, Roger
  • Anton, Jesús
  • Dewbre, Joe

Abstract

As agricultural policies continue to evolve away from traditional modes of support towards policies based upon or primarily influencing the market for land, it has become necessary to reconsider the way such policies are reflected in models. We demonstrate how the structure of land supply is constructed in the Policy Evaluation Model (PEM), and illustrate some potential options for representing land or historical entitlement-based programs using this model. Despite some basic similarities, the different choices for policy representation lead to significantly different model results. No policy may be considered to be entirely non-distorting of production decisions.

Suggested Citation

  • Martini, Roger & Anton, Jesús & Dewbre, Joe, 2005. "Policy Changes and Modelling Challenges: Insights from PEM Analysis," 89th Seminar, February 2-5, 2005, Parma, Italy 234615, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae89:234615
    DOI: 10.22004/ag.econ.234615
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    References listed on IDEAS

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    1. Anton, Jesus & Le Mouel, Chantal, 2003. "Do Counter-Cyclical Payments In The Fsri Act Create Incentives To Produce?," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25811, International Association of Agricultural Economists.
    2. Thomas W. Hertel, 1989. "Negotiating Reductions in Agricultural Support: Implications of Technology and Factor Mobility," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(3), pages 559-573.
    3. Lewell F. Gunter & Ki Hong Jeong & Fred C. White, 1996. "Multiple Policy Goals in a Trade Model with Explicit Factor Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(2), pages 313-330.
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