IDEAS home Printed from https://ideas.repec.org/p/tea/wpaper/0611.html
   My bibliography  Save this paper

The Effect of Decoupling on Farming in Ireland: A Regional Analysis

Author

Listed:
  • Thia Hennessy

    (Rural Economy and Development Programme, Teagasc, Athenry, Co. Galway, Ireland)

  • Shailesh Shrestha

    (Rural Economy and Development Programme, Teagasc, Athenry, Co. Galway, Ireland)

  • Stephen Hynes

    (Rural Economy and Development Programme, Teagasc, Athenry, Co. Galway, Ireland)

Abstract

This paper uses Irish National Farm Survey and Census of Agriculture data to analyse the regional implications of the decoupling of direct payments for farmers in Ireland. A mathematical programming model is used to estimate the regional effects of decoupling while a microsimulation model is exploited to map the geographic distribution of decoupled payments. The results show that under the historical decoupling scheme, milk quota will shift from less efficient to larger more efficient farms in all regions. Beef cattle numbers are projected to decrease on all farms with the exception of the mid-east and south-east regions where farmers are projected to increase animal numbers. The regional effect of decoupling on sheep farming is marginal with all regions projected to benefit from the policy change. The analysis also shows, using a static microsimulation model, that a shift to a flat rate national calculation of the decoupled payment would result in a significant movement of revenues from the southeast of the country to the northwest. In particular, large beef and dairy farmers in the south would lose out while small dairy and sheep farmers in the west and northwest would be most likely to gain.

Suggested Citation

  • 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.
    • Handle: RePEc:tea:wpaper:0611
    as

    Download full text from publisher

    File URL: http://www.teagasc.ie/rural-economy/downloads/workingpapers/06wpre11.pdf
    File Function: First version, 2006
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Stephen Hynes & Karyn Morrissey & Cathal O’Donoghue, 2005. "Building a Static Farm Level Spatial Microsimulation Model: Statistically Matching the Irish National Farm Survey to the Irish Census of Agriculture," Working Papers 0506, Rural Economy and Development Programme,Teagasc.
    2. Swinbank, Alan & Tranter, Richard B., 2005. "Decoupling EU Farm Support: Does the New Single Payment Scheme Fit within the Green Box?," Estey Centre Journal of International Law and Trade Policy, Estey Centre for Law and Economics in International Trade, vol. 6(01), pages 1-15.
    3. Beard, Nick & Swinbank, Alan, 2001. "Decoupled payments to facilitate CAP reform," Food Policy, Elsevier, vol. 26(2), pages 121-145, April.
    4. Breen, James P. & Hennessy, Thia C. & Thorne, Fiona S., 2005. "The effect of decoupling on the decision to produce: An Irish case study," Food Policy, Elsevier, vol. 30(2), pages 129-144, April.
    5. Rey, Bernard & Das, Sachindra M., 1997. "A systems analysis of inter-annual changes in the pattern of sheep flock productivity in Tanzanian livestock research centres," Agricultural Systems, Elsevier, vol. 53(2-3), pages 175-190.
    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. Cathal O'Donoghue & Thia Hennessy, 2014. "Chapter 03: The Agri-Food Sector," Chapters from Rural Economic Development in Ireland, in: Rural Economic Development in Ireland, edition 1, chapter 3, Rural Economy and Development Programme,Teagasc.
    2. Eory, Vera & MacLeod, Michael & Shrestha, Shailesh & Roberts, David, 2014. "Linking an Economic and a Life-cycle Analysis Biophysical Model to Support Agricultural Greenhouse Gas Mitigation Policy," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 63(3).
    3. Cathal O'Donoghue & Thia Hennessy, 2015. "Policy and Economic Change in the Agri-Food Sector in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 46(2), pages 315-337.
    4. Shrestha, Shailesh & Hennessy, Thia & Abdalla, Mohamed & Forristal, Dermot & Jones, Michael B., 2014. "Determining Short Term Responses of Irish Dairy Farms under Climate Change," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 63(03), pages 1-13, September.
    5. O’Donoghue, Cathal & McKinstry, Alistair & Green, Stuart & Fealy, Reamonn & Heanue, Kevin & Ryan, Mary & Connolly, Kevin & Desplat, J.C. & Horan, Brendan, 2016. "A Blueprint for a Big Data Analytical Solution to Low Farmer Engagement with Financial Management," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(A), pages 1-24, June.
    6. Shrestha, Shailesh & Hennessy, Thia & Abdalla, Mohamed & Forristal, Dermot & Jones, Michael B., 2014. "Determining Short Term Responses of Irish Dairy Farms under Climate Change," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 63(3).
    7. Eory, Vera & MacLeod, Michael & Shrestha, Shailesh & Roberts, David, 2014. "Linking an Economic and a Life-cycle Analysis Biophysical Model to Support Agricultural Greenhouse Gas Mitigation Policy," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 63(03), pages 1-10, September.
    8. Norton, Daniel & Hynes, Stephen & Buckley, Cathal & Ryan, Mary & Doherty, Edel, 2020. "Estimating the value of agroecosystem services in Ireland’s catchments," Working Papers 309504, National University of Ireland, Galway, Socio-Economic Marine Research Unit.
    9. 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.
    10. Jason Loughrey & Fiona Thorne & Thia Hennessy, 2016. "A Microsimulation Model for Risk in Irish Tillage Farming," International Journal of Microsimulation, International Microsimulation Association, vol. 9(2), pages 41-76.
    11. Cathal O'Donoghue & Karyn Morrissey & John Lennon, 2014. "Spatial Microsimulation Modelling: a Review of Applications and Methodological Choices," International Journal of Microsimulation, International Microsimulation Association, vol. 7(1), pages 26-75.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ole Boysen & Ana Corina Miller & Alan Matthews, 2016. "Economic and Household Impacts of Projected Policy Changes for the Irish Agri-food Sector," Journal of Agricultural Economics, Wiley Blackwell, vol. 67(1), pages 105-129, February.
    2. Kogler, Klaus & Saunders, Caroline M., 2006. "Single Farm Payment in the European Union and its Implications on New Zealand Dairy and Beef Trade," 2006 Conference, August 24-25, 2006, Nelson, New Zealand 31953, New Zealand Agricultural and Resource Economics Society.
    3. Pierre Boulanger & Kirsten Boysen-Urban & George Philippidis, 2021. "European Union Agricultural Support ‘Coupling’ in Simulation Modelling: Measuring the Sustainability Impacts," Sustainability, MDPI, vol. 13(6), pages 1-17, March.
    4. Happe, Kathrin & Balmann, Alfons & Kellermann, Konrad & Sahrbacher, Christoph, 2008. "Does structure matter? The impact of switching the agricultural policy regime on farm structures," Journal of Economic Behavior & Organization, Elsevier, vol. 67(2), pages 431-444, August.
    5. Latruffe, Laure & Mann, Stefan, 2009. "Another look at the distribution of direct payments: The link with part-time farming," Working Papers 210395, Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2).
    6. Jales, Mário, 2010. "How Would A Trade Deal On Cotton Affect Exporting And Importing Countries?," WTO Doha Round 320115, International Centre for Trade and Sustainable Development (ICTSD).
    7. Thorne, Fiona S. & Hennessy, Thia C., 2006. "The Role of Risk in the Decision to Produce Post-Decoupling - A Stochastic Budgeting Example," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25415, International Association of Agricultural Economists.
    8. Cathal O'Donoghue & Thia Hennessy, 2015. "Policy and Economic Change in the Agri-Food Sector in Ireland," The Economic and Social Review, Economic and Social Studies, vol. 46(2), pages 315-337.
    9. Rezbova, Helena & Tomsík, Karel, 2012. "Impact of Complementary National Direct Payments on Cattle Breeding Sector," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 4(4 Special), pages 1-11, December.
    10. Anania, Giovanni, 2007. "Multilateral Negotiations, Preferential Trade Agreements and the CAP. What's Ahead?," Working Papers 7283, TRADEAG - Agricultural Trade Agreements.
    11. Joseph A. McMahon, 2007. "Trade Policy Reform Through Litigation La voie judiciaire pour réformer les politiques commerciales Reform der Handelspolitik durch Rechtsstreitigkeiten," EuroChoices, The Agricultural Economics Society, vol. 6(2), pages 42-47, August.
    12. Viaggi, Davide & Raggi, Meri & Gomez y Paloma, Sergio, 2011. "Farm-household investment behaviour and the CAP decoupling: Methodological issues in assessing policy impacts," Journal of Policy Modeling, Elsevier, vol. 33(1), pages 127-145, January.
    13. Breen, James P., 2007. "PR - The Impact Of The Rural Environmental Protection Scheme On Irish Dairy Farm Performance And The Consequences In A Decoupled World," 16th Congress, Cork, Ireland, July 15-20, 2007 345361, International Farm Management Association.
    14. Matthews, Alan & Salvatici, Luca & Scoppola, Margherita, 2017. "Trade Impacts of Agricultural Support in the EU," Commissioned Papers 252767, International Agricultural Trade Research Consortium.
    15. Thia C. Hennessy & Tahir Rehman, 2008. "Assessing the Impact of the ‘Decoupling’ Reform of the Common Agricultural Policy on Irish Farmers’ Off‐farm Labour Market Participation Decisions," Journal of Agricultural Economics, Wiley Blackwell, vol. 59(1), pages 41-56, February.
    16. Julien Labonne & Pierre-Alain Jayet, 2005. "Impact d’une réforme de la Politique Agricole Commune par le découplage," Économie et Prévision, Programme National Persée, vol. 167(1), pages 101-116.
    17. James Breen & Fiona Thorne & Thia Hennessy, 2005. "Decoupled Payments and the Decision to Produce," Working Papers 0502, Rural Economy and Development Programme,Teagasc.
    18. Elodie Douarin & Laure Latruffe, 2011. "Potential impact of the EU Single Area Payment on farm restructuring and efficiency in Lithuania," Post-Communist Economies, Taylor & Francis Journals, vol. 23(1), pages 87-103.
    19. Latruffe, Laure & Dupuy, Aurelia & Desjeux, Yann, 2012. "What would farmers’ strategies be in a no-CAP situation? An illustration to France," 86th Annual Conference, April 16-18, 2012, Warwick University, Coventry, UK 134989, Agricultural Economics Society.
    20. Genius, Margarita, 2013. "Production and Off-Farm Employment Decisions of Greek and Hungarian Farmers in the Light of the Last CAP Refrom," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 14(2), pages 1-16.

    More about this item

    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:tea:wpaper:0611. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: John Lennon (email available below). General contact details of provider: https://edirc.repec.org/data/reteaie.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.