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Regional Differences in Benefits from the EU Common Agricultural Policy in Poland and Their Policy Implications

Ewa Kiryluk-Dryjska and Agnieszka Baer-Nawrocka
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Ewa Kiryluk-Dryjska: Faculty of Economics, Poznan University of Life Sciences, Wojska Polskiego 28, 60-637 Poznań, Poland
Agnieszka Baer-Nawrocka: Faculty of Economics, Poznan University of Life Sciences, Wojska Polskiego 28, 60-637 Poznań, Poland

Agriculture, 2021, vol. 11, issue 4, 1-14

Abstract: Although the beneficial impact of Common Agricultural Policy (CAP) on the stabilization on farming income is undisputable, the distribution of benefits derived from the CAP between operators and regions gives rise to some controversy. The objective of this paper was to estimate regional differences in the benefits derived from the Common Agricultural Policy in Poland based on the partial equilibrium model of the European Union (EU) agricultural sector with simulated interventions. The expectations of farmers from different regions of Poland were represented as a non-cooperative game to define vectors of change in the agricultural policy. The theory of moves was applied to set the game between different groups of farmers. Our results demonstrate that both the 1st and the 2nd pillars of the CAP were more profitable to farmers from regions with a more advantageous agrarian structure and a higher agricultural potential compared to their peers from the regions with a fragmented agriculture. However, considering long-term development objectives of the Polish agriculture, the theory of moves outcome argues against compensating for these differences by increasing redistributive payments to farmers in less favorable regions. To prevent widening of regional differences and ensure the social and economic development of rural areas in regions with less favorable agrarian structures where agriculture is currently unable to compete, it would be critical to enhance conditions for alternative types of economic activities.

Keywords: the CAP; agricultural income; regional differences (search for similar items in EconPapers)
JEL-codes: Q1 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 (search for similar items in EconPapers)
Date: 2021
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