The two dimensions of policy impacts on economic cohesion: Concept and illustration for the CAP

Heiko Hansen and Roland Herrmann

Food Policy, 2012, vol. 37, issue 4, 483-491

Abstract: Given the growing importance of cohesion policy within the European Union (EU) during the last two decades, public and scientific interest in the role of EU policies for regional disparities has risen continuously. Recent empirical studies on the impacts of the Common Agricultural Policy (CAP) on economic cohesion have been strikingly diverse in their principal findings. Whereas some studies suggest positive overall effects on economic cohesion, others stress exactly the opposite. One major reason for the ambiguous results is that a single agreed-upon measure of economic cohesion is lacking. We propose a concept that distinguishes between two dimensions of policy impacts on economic cohesion: (i) the redistributive impact at a defined period of time and (ii) the change of the redistributive impact over time. The first dimension addresses the question whether a policy makes the distribution of a target variable, e.g., income, more equal or unequal at one point of time. The second dimension covers the impact of the policy on the disparity of the same variable over time, i.e., the impact on convergence. An empirical illustration of the concept for 13 NUTS 1 regions in Germany over the period 1991–2009 reveals that the two policy impacts of the CAP are partly contradictory for the two dimensions. It is shown that the CAP fosters economic cohesion by reducing regional disparities in each individual year. With regard to redistributive impacts over time, we find that CAP transfers leave income convergence largely unaffected for society as a whole. Within the agricultural sector, it leads to a convergence of receipts per farm whereas it induces a divergence of farm receipts per hectare.

Keywords: Policy instruments; Economic cohesion; Redistributive impact; Convergence; Common Agricultural Policy (CAP) (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0306919212000127
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jfpoli:v:37:y:2012:i:4:p:483-491

DOI: 10.1016/j.foodpol.2012.02.008

Access Statistics for this article

Food Policy is currently edited by J. Kydd

More articles in Food Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().