Home Economics Disaggregated impacts of CAP reforms : proceedings of an OECD workshop.
Impacts of decoupling on farm structure
As a basis for understanding the consequences of decoupling for landscape, we first present the modelled impacts on farm structure. Compared with the continuation of production support (AGENDA), decoupling (REFORM) is shown in Figure 12.1 to slow the rate of farm exits, and hence growth in farm size (Figure 12.2) in all regions. This is because farm agents have the alternative of not producing and simply maintaining land in GAEC, a relatively low-cost measure. For these farms, maintaining their least productive land in GAEC is, according to the model, more profitable than commodity production or off-farm work opportunities. This effect was least noticeable in the Mediterranean because only a minor area of land was taken out of production and most significant in the Swedish regions because of the large areas of grassland.
The BOND results demonstrate that the GAEC requirement slows structural change considerably in EU15 regions as shown in Figures 12.1 and 12.2 (but avoided “abandonment” of land in the most extensive regions, see below). The GAEC requirement had little impact on farm structure in Vysocina because of poor off-farm work opportunities. Thus the type of decoupling scheme — with or without a land management obligation — has potentially important implications for structural change and hence the landscape.
Figure 12.1. Change in number of farms from 2004 to 2013 with the Agenda 2000 scenario, actual implementation of the 2003 reform and bond scenario
Source: Brady et al. (2009).
Figure 12.2. Average farm size in 2013 with the Agenda 2000 scenario, actual implementation of the 2003 reform and bond scenario
Source: Brady etal. (2009).
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