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The Impact of the 2013 CAP Reform on Land Capitalization

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  • Pavel Ciaian
  • d'Artis Kancs
  • Johan Swinnen

Abstract

Decoupled direct payments were introduced in the EU in form of the Single Payment Scheme (SPS) in 2005. The 2013 CAP reform changed both the implementation of the SPS and its budget. We assess the possible effects of the 2013 CAP reform on EU land markets; in particular the capitalization of the SPS in land rental values. Our analyses suggest that the implementation details of the 2013 CAP reform will largely determine the impact of the SPS on land markets. The key ones are the reference period for entitlement allocation, regionalization, payment differentiation and budgetary changes. Our analysis also implies that a number of relatively minor policy changes could have substantial impacts on land markets.

Suggested Citation

  • Pavel Ciaian & d'Artis Kancs & Johan Swinnen, 2014. "The Impact of the 2013 CAP Reform on Land Capitalization," EERI Research Paper Series EERI RP 2014/07, Economics and Econometrics Research Institute (EERI), Brussels.
  • Handle: RePEc:eei:rpaper:eeri_rp_2014_07
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    Citations

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    Cited by:

    1. Paul Feichtinger & Klaus Salhofer, 2016. "The Fischler Reform of the Common Agricultural Policy and Agricultural Land Prices," Land Economics, University of Wisconsin Press, pages 411-432.
    2. Klaiber, Allen & Salhofer, Klaus & Thompson, Stan, 2015. "Capitalization of the SPS into Agricultural Land Rental Prices under Harmonization of Payments," 2015 Conference, August 9-14, 2015, Milan, Italy 211934, International Association of Agricultural Economists.
    3. Pavel Ciaian & d'Artis Kancs & Dusan Drabik, 2016. "Land Markets in Europe: Institutions and Market Outcomes," EERI Research Paper Series EERI RP 2016/10, Economics and Econometrics Research Institute (EERI), Brussels.
    4. Pavel Ciaian & d'Artis Kancs & Maria Espinosa, 2016. "The Impact of the 2013 CAP Reform on the Decoupled Payments' Capitalization into Land Values," JRC Working Papers JRC101619, Joint Research Centre (Seville site).
    5. Urban, Kirsten & Jensen, Hans G. & Brockmeier, Martina, 2016. "How decoupled is the Single Farm Payment and does it matter for international trade?," Food Policy, Elsevier, vol. 59(C), pages 126-138.
    6. Kamel Elouhichi & Maria Espinosa Goded & Pavel Ciaian & Angel Perni Llorente & Bouda Vosough Ahmadi & Liesbeth Colen & Sergio Gomez Y Paloma, 2018. "The EU-Wide Individual Farm Model for Common Agricultural Policy Analysis (IFM-CAP v.1): Economic Impacts of CAP Greening," JRC Working Papers JRC108693, Joint Research Centre (Seville site).
    7. Paul Feichtinger & Klaus Salhofer, 2016. "Decoupled Single Farm Payments of the CAP and Land Rental Prices," Working Papers 652016, Institute for Sustainable Economic Development, Department of Economics and Social Sciences, University of Natural Resources and Life Sciences, Vienna.
    8. Svoboda, J. & Lososová, Jana & Zdeněk, R., 2015. "Analysis of Operating Costs of Subsidies in the Field of Agriculture of EU Countries," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 7(4), December.
    9. Pavel Ciaian & Dusan Drabik & Jan Falkowski & d'Artis Kancs, 2016. "Market Impacts of New Land Market Regulations in Eastern EU Member States," EERI Research Paper Series EERI RP 2016/02, Economics and Econometrics Research Institute (EERI), Brussels.
    10. V. Santoni & M. Pulina, 2016. "An analysis on the Italian agricultural firms: effects of public subsidies," Working Paper CRENoS 201611, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.

    More about this item

    Keywords

    Capitalization; decoupled subsidies; CAP reform; land market; land prices.;

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • P32 - Economic Systems - - Socialist Institutions and Their Transitions - - - Collectives; Communes; Agricultural Institutions
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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