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CAP Subsidies and the Productivity of EU Farms

Marian Rizov (), Jan Pokrivcak () and Pavel Ciaian

No 148, Factor Markets Working Papers from Centre for European Policy Studies

Abstract: This paper investigates the impact of subsidies from the common agricultural policy on the total factor productivity of farms in the EU. We employ a structural, semi-parametric estimation algorithm, directly incorporating the effect of subsidies into a model of unobserved productivity. We empirically study the effects using samples from the Farm Accountancy Data Network for EU-15 countries. Our main findings are clear: subsidies had a negative impact on farm productivity in the period before the decoupling reform was implemented; after decoupling the effect of subsidies on productivity was more nuanced, as in several countries it turned positive.

Pages: 28 pages
Date: 2013-03
New Economics Papers: this item is included in nep-agr, nep-eff and nep-eur
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Related works:
Journal Article: CAP Subsidies and Productivity of the EU Farms (2013) Downloads
Working Paper: CAP Subsidies and the Productivity of EU Farms (2013) Downloads
Working Paper: CAP Subsidies and Productivity of EU Farms (2013) Downloads
Working Paper: CAP subsidies and productivity of the EU farms (2012) Downloads
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