IDEAS home Printed from https://ideas.repec.org/p/eei/rpaper/eeri_rp_2002_02.html
   My bibliography  Save this paper

The impact of the Common Agricultural Policy on income distribution and welfare in Central and Eastern European Countries

Author

Listed:
  • Pavel Ciaian

Abstract

In this paper we develop a partial equilibrium model for agricultural sector to assess the impact of CEE integration with the EU on welfare and income distribution of agricultural factors. The modelling framework is based on the concept of market imperfections and transaction costs. We perform several policy simulations with different levels of direct payments as given in the most recent European Commission proposal. We find that even the most sceptical European Commission proposal of awarding the CEE farmers only 25% of the direct payments will increase welfare and income of farmers. However, the distribution of CAP rents are affected by the institutional structure. We find an adverse impact on allocation of incomes and welfare that are generated by the integration in Slovakia and in the Czech Republic. The major part of it - between 65% to 93% - is transferred to owners of production factors, such as hired labour, landowners and variable capital suppliers, but not as desired to support farmer incomes. In Poland the gains resulting from the integration are allocated more favourably to farmers. Factor owners retain only around 24% to 61%, depending on the level of direct payments.

Suggested Citation

  • Pavel Ciaian, 2002. "The impact of the Common Agricultural Policy on income distribution and welfare in Central and Eastern European Countries," EERI Research Paper Series EERI_RP_2002_02, Economics and Econometrics Research Institute (EERI), Brussels.
  • Handle: RePEc:eei:rpaper:eeri_rp_2002_02
    as

    Download full text from publisher

    File URL: http://www.eeri.eu/documents/wp/EERI_RP_2002_02.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Lluch, Constantino & Powell, Alan, 1975. "International comparisons of expenditure patterns," European Economic Review, Elsevier, vol. 6(3), pages 275-303, July.
    2. Anderson, Kym & Tyers, Rodney, 1993. "Implications of EC Expansion for European Agricultural Policies, Trade and Welfare," CEPR Discussion Papers 829, C.E.P.R. Discussion Papers.
    3. Banse, Martin & Münch, Wolfgang & Tangermann, Stefan, 2000. "Eastern Enlargement of the European Union: General and Partial Equilibrium Analysis," 2000 Conference, August 13-18, 2000, Berlin, Germany 197223, International Association of Agricultural Economists.
    4. Lopez, Ramon E., 1984. "Estimating labor supply and production decisions of self-employed farm producers," European Economic Review, Elsevier, vol. 24(1), pages 61-82.
    5. de Crombrugghe, Denis & Palm, Franz C & Urbain, Jean-Pierre, 1997. "Statistical Demand Functions for Food in the USA and the Netherlands," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 12(5), pages 615-637, Sept.-Oct.
    6. Finke, Renate & Lu, Wen-He & Theil, Henri, 1984. "A cross-country tabulation of own-price elasticities of demand," Economics Letters, Elsevier, vol. 14(2-3), pages 137-142.
    7. Johan F. M. Swinnen, 1999. "The political economy of land reform choices in Central and Eastern Europe," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 7(3), pages 637-664, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tao Xiang & Jikun Huang & d’Artis Kancs & Scott Rozelle & Jo Swinnen, 2012. "Food Standards and Welfare: General Equilibrium Effects," Journal of Agricultural Economics, Wiley Blackwell, vol. 63(2), pages 223-244, June.

    More about this item

    Keywords

    Partial equilibrium; model CAP; EU enlargement; Common Agricultural Policy; Decoupling; Computable General Equilibrium;

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • P24 - Economic Systems - - Socialist Systems and Transition Economies - - - National Income, Product, and Expenditure; Money; Inflation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eei:rpaper:eeri_rp_2002_02. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julia van Hove). General contact details of provider: http://edirc.repec.org/data/eeriibe.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.