Redistribution and the Abolishment of Historical Entitlements in the CAP Strategic Plans: The Case of Greece

Dimitrios Kremmydas and Konstantinos Tsiboukas
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Dimitrios Kremmydas: Department of Agricultural Economics and Rural Development, Agricultural University of Athens, Iera Odos 75, 11855 Athens, Greece
Konstantinos Tsiboukas: Department of Agricultural Economics and Rural Development, Agricultural University of Athens, Iera Odos 75, 11855 Athens, Greece

Sustainability, 2022, vol. 14, issue 2, 1-14

Abstract: A key issue in CAP strategic planning in Greece is the treatment of historical entitlements. An unequal level of payments per hectare is difficult to justify in terms of the CAP’s rationale, and so the abolishment of these entitlements seems to be the most reasonable option. However, for historical reasons, this abolishment may result in a transfer of payments from smaller to larger farms and between different agricultural sub-sectors which could in turn lead to negative effects on the incomes of small farms and lead to farmers leaving the sector. We simulate the change to a flat rate payment in order to quantify these effects, then explore the possibility of employing the new obligatory redistribution measure, termed complementary income support, to mitigate any negative effects. We conclude that redistribution is, indeed, a powerful tool for fine-tuning decoupled payments if historical entitlements are to be abolished.

Keywords: agricultural policy; simulation; convergence; small farms; common agricultural policy (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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