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Hybrid linear programming to estimate CAP impacts of flatter rates and environmental top-ups

Stelios Rozakis

No 2010-03, Working Papers from Agricultural University of Athens, Department Of Agricultural Economics

Abstract: This paper examines evolutions of the Common Agricultural Policy (CAP) decoupling regime and their impacts on Greek arable agriculture. Policy analysis is performed by using mathematical programming tools. Taking into account increasing uncertainty, we assume that farmers perceive gross margin in intervals rather than as expected crisp values. A bottom-up hybrid model accommodates both profit maximizing and risk prudent attitudes in order to accurately assess farmers’ response. Marginal changes to crop plans are expected so that flatter single payment rates cause significant changes in incomes and subsidies. Nitrogen reduction incentives result in moderate changes putting their effectiveness in question.

Keywords: Interval Linear Programming; Min-Max Regret; Common Agricultural Policy; Arable cropping; Greece (search for similar items in EconPapers)
JEL-codes: C61 D81 Q12 Q18 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2010
New Economics Papers: this item is included in nep-agr and nep-env
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