EFFECTS OF POLICY INSTRUMENTS ON FARM INVESTMENTS AND PRODUCTION DECISIONS IN THE SPANISH COP SECTOR

Zein Kallas (), Teresa Serra and José M. Gil ()
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Zein Kallas: CREDA - CREDA - Centre de Recerca en Economia i Desenvolupament Agroalimentaris
José M. Gil: CREDA - CREDA - Centre de Recerca en Economia i Desenvolupament Agroalimentaris

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Abstract: Our paper assesses the impacts regarding on-farm investment and production decisions resulting from the partially decoupled (PD) payment scheme implemented during the 1990s and first half of the 2000s within the framework of the Common Agricultural Policy (CAP). The Spanish cereal, oilseed, and protein (COP) sector is taken as a case study regarding this effect due to its economic and political relevance in Spain. The empirical analysis is applied to farm-level data from 2000 to 2004 using the Farm Accountancy Data Network (FADN). We use a reduced-form application of the dual model of investment under uncertainty and estimate a system of censored and uncensored equations. PD payments are found to increase short-run production and generate a statically significant increase in the investment in farm assets. Results also show the importance of assessing the effects of PD payments in a dynamic framework as applied in this paper

Keywords: Social; Sciences; &; Humanities (search for similar items in EconPapers)
Date: 2011-06-27
Note: View the original document on HAL open archive server: https://hal.science/hal-00712381
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Published in Applied Economics, 2011, pp.1. ⟨10.1080/00036846.2011.583220⟩

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Related works:
Journal Article: Effects of policy instruments on farm investments and production decisions in the Spanish COP sector (2012)
Working Paper: Effects of policy instruments on farm investments and production decisions in the Spanish cop sector (2009)
Working Paper: EFFECTS OF POLICY INSTRUMENTS ON FARM INVESTMENTS AND PRODUCTION DECISIONS IN THE SPANISH COP SECTOR (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-00712381

DOI: 10.1080/00036846.2011.583220

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