IDEAS home Printed from
   My bibliography  Save this paper

A framework for assessing the economic consequences of the support for Less Favoured Areas within Pillar II of Common Agricultural Policy in a multi-regional CGE setting, with an application to Poland


  • James Giesecke


  • Mark Horridge
  • Katarzyna Zawalinska



The Common Agricultural Policy (CAP) is one of the most complex and also the most costly of all EU policies. It comprises over 40 financing streams, including Pillar I and Pillar II measures which are highly regulated. In the case of Poland, these are directed to all 16 NUTS2 regions. We are modelling here the regional and thus national consequences of the CAP's most costly Pillar II measure in Poland, so called Less Favoured Areas support (LFA). It is complex, when we recognise the multipurpose of this measure and significant amount of funds directed at a large number of regions. To handle the regional complexity of this problem, we require a multi-regional model. Such a model must be detailed in its disaggregation of industries, commodities and households if it is to be capable of reflecting the complexity of this measure. As such, we use a large-scale multi-regional CGE model. The model is tailored to reflect the complexity of the rural development policy (Pillar II), of which LFA is the largest part in Poland. Of the 82 region-specific sectors in the model, over 20 is related to agricultural production. The model distinguishes rural and urban households in each region and is based on the most recent IO tables of 2005. We propose a framework for mapping the individual financing stream of the LFA to the specific structural variables relating to specific type of land (LFA and nonLFA) in each region. As to our best knowledge such an approach was never conducted before with respect not only of LFA but also Pillar II measures in general.

Suggested Citation

  • James Giesecke & Mark Horridge & Katarzyna Zawalinska, 2011. "A framework for assessing the economic consequences of the support for Less Favoured Areas within Pillar II of Common Agricultural Policy in a multi-regional CGE setting, with an application to Poland," ERSA conference papers ersa10p872, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa10p872

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Mark Horridge & Glyn Wittwer, 2007. "The economic impacts of a construction project, using SinoTERM, a multi-regional CGE model of China," Centre of Policy Studies/IMPACT Centre Working Papers g-164, Victoria University, Centre of Policy Studies/IMPACT Centre.
    2. Joaquim Bento de Souza Ferreira Filho & Carliton Vieira dos Santos & Sandra Maria do Prado Lima, 2007. "Tax Reform, Income Distribution and Poverty in Brazil: an Applied General Equilibrium Analysis," Working Papers MPIA 2007-26, PEP-MPIA.
    3. Glyn Wittwer, 2009. "The Economic Impacts of a New Dam in South-East Queensland," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 42(1), pages 12-23, March.
    4. Zawalinska, Katarzyna, 2009. "Evaluation of rural development programs after Poland’s accession to the EU: regional CGE approach," 2009 Conference, August 16-22, 2009, Beijing, China 51342, International Association of Agricultural Economists.
    5. Naqvi, Farzana & Peter, Matthew W, 1996. "A Multiregional, Multisectoral Model of the Australian Economy with an Illustrative Application," Australian Economic Papers, Wiley Blackwell, vol. 35(66), pages 94-113, June.
    Full references (including those not matched with items on IDEAS)

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    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:wiw:wiwrsa:ersa10p872. 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: (Gunther Maier). General contact details of provider: .

    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.