The Economic Impact of Public Support to Agriculture: An International Perspective

Description

The recent reforms of the Common Agricultural Policy (CAP) of the European Union extend in a significant way the “decoupling” process started some ten years earlier. By adopting the Single Farm Payment (SFP) scheme only limited support for agriculture is tied to current production decisions. This is also true of U.S. farm policy. The reform act of 1996 introduced greater planting flexibility, shifted some support to direct payments, and eliminated the authority for acreage reduction programs. The 2002 and 2008 Acts retained these features. However, they added countercyclical components to direct payments based on market prices and historic production, and allowed for updating of base acreage underlying direct payments. These steps arguably reintroduced ties between support and production decisions. This volume explores the economic implications of these recent changes in the design of agricultural policies for the economic performance of the sector in the European Union and the United States. The book is organized around five themes: (1) New Directions in Agricultural Policy: U.S. and EU Perspectives; (2) Agricultural Policy and Economic performance; (3) Energy and Agricultural Policy; (4) International Trade and Agricultural Policy; and (5) Commodity Programs and Risk Management. The authors apply rigorous tools to analyze the impact and implications of current agricultural policies on efficiency, productivity, and competitiveness in the sector, and consider opportunities for improvement in policymaking and practice. Front Matter....Pages i-xi Front Matter....Pages 9-9 Introduction and Overview....Pages 1-8 Front Matter....Pages 9-9 Recent Developments and Applications from the OECD Toolbox....Pages 11-39 US and EU Agricultural Policy: Divergence or Convergence?....Pages 41-66 The “Health Check” of the CAP Reform: Lessons from Its Impact Assessment....Pages 67-79 The Incidence of US Farm Programs....Pages 81-105 Front Matter....Pages 107-107 Impact of Subsidies on Farm Productivity and Efficiency....Pages 109-124 Productivity and Profitability of US Agriculture: Evidence from a Panel of States....Pages 125-139 Front Matter....Pages 141-141 Biofuels Expansion in a Changing Economic Environment: A Global Modeling Perspective....Pages 143-154 Ethanol and Corn Prices: The Role of US Tax Credits, Mandates, and Imports....Pages 155-169 Modeling the Effects of U.S. Biofuel Policies on Commodity and Energy Markets....Pages 171-190 Biofuels Versus Food Competition for Agricultural Resources: Impacts on the EU Farming Systems....Pages 191-209 Front Matter....Pages 211-211 WTO Compliance and Domestic Farm Policy Change....Pages 213-241 Agricultural Competitiveness....Pages 243-271 The Behavior of Relative Food Prices: An Analysis across the European Countries....Pages 273-289 Front Matter....Pages 291-291 The Political Economy of the US Crop Insurance Program....Pages 293-308 Aggregation and Arbitrage in Joint Production....Pages 309-328 Standard and Bayesian Random Coefficient Model Estimation of US Corn–Soybean Farmer Risk Attitudes....Pages 329-343 Back Matter....Pages 345-348