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Farm expansion in Lithuania after accession to the EU: The role of CAP payments in alleviating potential credit constraints

Author

Listed:
  • Laure Latruffe
  • Sophia Davidova
  • Elodie Douarin
  • Matthew Gorton

Abstract

The impact of the introduction of EU Single Area Payments (SAP) on farm expansion strategy in Lithuania is investigated, utilizing farm accounting and survey data. The introduction of the SAP has a positive influence on farmers’ intentions to expand their area compared to a baseline scenario of the hypothetical continuation of pre-accession policy. The switch in policy has a more pronounced effect on farms that were previously credit constrained. While the SAP has been presented as a support that is decoupled from production, its introduction may have ex post coupled effects, through an income multiplier effect on credit constrained farmers

Suggested Citation

  • Laure Latruffe & Sophia Davidova & Elodie Douarin & Matthew Gorton, 2008. "Farm expansion in Lithuania after accession to the EU: The role of CAP payments in alleviating potential credit constraints," Working Papers SMART - LERECO 08-06, INRA UMR SMART-LERECO.
  • Handle: RePEc:rae:wpaper:200806
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Jean Joseph Minviel & Kristof De Witte, 2016. "The influence of public subsidies on farm technical efficiency: A robust conditional nonparametric approach," Working Papers SMART - LERECO 16-10, INRA UMR SMART-LERECO.
    2. Marie-Line Duboz & Julie Le Gallo, 2011. "Are EU-15 and CEEC agricultural exports in competition? Evidence for 1995-2005," Economics Bulletin, AccessEcon, vol. 31(1), pages 134-146.
    3. Pavel Ciaian & Jan Fałkowski & D’Artis Kancs, 2012. "Productivity and credit constraints: A firm-level propensity score evidence for agricultural farms in central and east European countries," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 62(4), pages 459-487, December.
    4. Van Herck, Kristine & Vranken, Liesbet, 2012. "Direct Payments and Land Rents: Evidence from New Member States," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126777, International Association of Agricultural Economists.
    5. Saint-Cyr, Legrand D. F., 2016. "Farm segmentation and agricultural policy impacts on structural change: evidence from France," 149th Seminar, October 27-28, 2016, Rennes, France 244789, European Association of Agricultural Economists.
    6. Pavel Ciaian, 2012. "Access to credit, factor allocation and farm productivity: Evidence from the CEE transition economies," Agricultural Finance Review, Emerald Group Publishing, vol. 72(1), pages 22-47, May.
    7. O’Toole, Conor & Hennessy, Thia, 2015. "Do decoupled payments affect investment financing constraints? Evidence from Irish agriculture," Food Policy, Elsevier, vol. 56(C), pages 67-75.
    8. Ciaian, Pavel & Fa?kowski, Jan & d’Artis, Kanc & Pokrivcak, Jan, 2011. "Productivity and Credit Constraints: Firm-Level Evidence from Propensity Score Matching," Factor Markets Working Papers 99, Centre for European Policy Studies.
    9. Marconi, V. & Raggi, M. & Viaggi, D. & Lefebvre, M. & Gomez y Paloma, Sergio, 2015. "The impact of the 2013 Common Agricultural Policy reform on farmer's investment decisions: an ex-ante evaluation," 2015 Conference, August 9-14, 2015, Milan, Italy 212225, International Association of Agricultural Economists.
    10. Sauer, Johannes & Davidova, Sophia & Latruffe, Laure, 2009. "Determinants of the Fallowing Decision in Kosovo," 83rd Annual Conference, March 30-April 1, 2009, Dublin, Ireland 51072, Agricultural Economics Society.
    11. Matthews, Alan & Salvatici, Luca & Scoppola, Margherita, 2017. "Trade Impacts of Agricultural Support in the EU," Commissioned Papers 252767, International Agricultural Trade Research Consortium.
    12. Ferto, Imre & Bakucs, Lajos Zoltan & Bojnec, Stefan & Latruffe, Laure, 2011. "Investment and Financial Constraints in European Agriculture: Evidence from France, Hungary and Slovenia," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114357, European Association of Agricultural Economists.
    13. Saint-Cyr, Legrand D. F., 2016. "Accounting for farm heterogeneity in the assessment of agricultural policy impacts on structural change," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 235778, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    Single Area Payments (SAP); Common Agricultural Policy (CAP); credit; investment; Lithuania;

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

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