Impact of CAP Subsidies on Technical Efficiency of Crop Farms in Germany,the Netherlands and Sweden

This paper analyses the impacts of CAP reforms, particularly subsidies on technical efficiency of crop farms. An output distance function is employed and estimated together with an inefficiency effects model to capture the effects of CAP subsidies and farmer characteristics on farm efficiency. The model is applied to FADN data (period 1995–2004) of crop farms in Germany, the Netherlands and Sweden. The study shows that the 10‐year average technical efficiency is 64% in Germany, 76% in the Netherlands and 71% in Sweden. The average annual changes in technical efficiency are 0.1%, 0.4% and 2.3%, respectively. The share of crop subsidies in total subsidies has a negative impact on technical efficiency in Germany but a positive impact in Sweden, although insignificant in the Netherlands. The share of total subsidies in total farm revenues has negative impacts on technical efficiency in all three countries, consistent with income and insurance effects. Positive (negative) change in technical efficiency is mainly attributable to farm size (degree of specialisation) in Germany, and degree of specialisation (degree of subsidy dependence) in the Netherlands and Sweden.     

CAP Subsidies and Productivity of the EU Farms

The paper investigates the impact of the Common Agricultural Policy (CAP) subsidies on farm total factor productivity (TFP) in the European Union (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 the Farm Accountancy Data Network (FADN) samples for the EU‐15 countries. Our main findings are clear: subsidies impact negatively on farm productivity in the period before the decoupling reform was implemented; after decoupling the effect of subsidies on productivity is more nuanced and in several countries it turned positive.     

Subsidies and agricultural productivity in the EU

This paper investigates the relationship between EU agricultural subsidies and agricultural labor productivity growth by estimating a conditional convergence growth model. We use more representative subsidy indicators and a wider coverage (panel data from 213 EU regions over the period 2004–2014) than have been used before. We find that, on average, EU's Common Agricultural Policy (CAP) subsidies increase agricultural labor productivity growth, but this aggregate effect hides important heterogeneity of effects of different types of subsidies. The positive effect on productivity comes from decoupled subsidies, that is, Pillar I decoupled payments and some Pillar II payments. Coupled Pillar I subsidies have the opposite effect: they slow down productivity growth.     

Impacts of Decoupled Agricultural Support on Farm Structure,Biodiversity and Landscape Mosaic: Some EU Results

The decoupling of direct payments from production represents a substantial reform of the Common Agricultural Policy (CAP). Farmers are no longer required to produce commodities to be entitled to support but only to keep land in Good Environmental and Agricultural Condition. If output declines as a result, there is concern that landscape services produced jointly with commodities will also decline. The aim of this paper is to assess the long‐term effects of the 2003 reform on farm structure, landscape mosaic and biodiversity for a sample of EU regions. Impacts are quantified using a spatial agent‐based modelling approach by simulating agricultural development with links to indicators of landscape value. Our results demonstrate that eliminating the link between support payments and production has possible negative consequences for the landscape, but only under particular circumstances. It is shown that these effects could be offset by strengthening (Pillar II) agri‐environmental schemes. Further the single payment scheme results in higher land rental prices which reduces its ability to achieve its goal of providing income security for farmers. Implications of these results for the direction of continued CAP reform are discussed.     

The Effect of Investment,LFA and Agri-environmental Subsidies on the Components of Total Factor Productivity: The Case of Slovenian Farms

The effect of subsidies on the performance of farms has received a great deal of attention in the literature, although results are inconclusive. Furthermore, much of the related literature examines the effect of subsidies only on technical efficiency (TE). We examine the effect of different types of subsidies on the different components of total factor productivity (TFP) in Slovenian agriculture over the period 2006–2013. We first estimate a Random Parameter Stochastic production frontier model. Then, based on the estimates of this model, we calculate and decompose the TFP index into TE, scale efficiency and technological change. Third, we apply combined difference-in-difference and a matching estimator to examine the effect of investment, less favoured area (LFA) and agri-environmental (AE) subsidies on the different components of TFP. In our case, these subsidies are found to have no significant effect on either TFP or on its components.     

Assessing the Forecasting Performance of a Generic Bio‐Economic Farm Model Calibrated With Two Different PMP Variants

Using linear programming in bio‐economic farm modelling often results in overspecialised model solutions. The positive mathematical programming (PMP) approach guarantees exact calibration to base year data but the forecasting capacity of the model is affected by necessary but arbitrary assumptions imposed during calibration. In this article, a new PMP variant is presented which is based on less arbitrary assumptions that, from a theoretical point of view, are closer to the actual decision making of the farmer. The PMP variant is evaluated according to the predictions of the bio‐economic farm model, developed within the framework for integrated assessment of agricultural systems in Europe (SEAMLESS). The forecasting capacity of the model calibrated with the standard PMP approach and the alternative PMP variant, respectively, is tested in ex‐post experiments for the arable farm types of Flevoland (the Netherlands) and Midi‐Pyrenees (France). The results of the ex‐post experiments, in which we try to simulate farm responses in 2003 using a model calibrated to 1999 data, show that the alternative PMP variant improves the forecasting capacity of the model in all tested cases.     

Farmer-to-farmer technology diffusion and yield variation among adopters: the case of improved cowpea in northern Nigeria

This article examines the magnitude and sources of yield variation among adopters of improved cowpea varieties in northern Nigeria promoted through farmer‐to‐farmer diffusion. The results reveal important efficiency differences between the lead farmers who have contacts with breeders and the follower farmers who get technology and information from the lead farmers. Differential adoption of the package of seed, insecticide, fertilizer, and recommended cereal‐cowpea cropping pattern provides much of the explanation for yield variation among adopters. The component often missing, and hence accounting for much of the yield variation, is the crop management technology relating to the cereal‐cowpea cropping pattern. No efficiency variation is attributed to the source of technology and information, such as whether improved cowpea was obtained from breeders or lead farmers. Technology source has a rather indirect influence on efficiency through its effect on package adoption where breeders promote greater package adoption among the lead farmers than the lead farmers do among the follower farmers. Possible ways of disseminating crop management technological information through the farmer‐to‐farmer technology diffusion are recommended to better exploit the yield and profitability potentials of improved cowpea varieties in northern Nigeria.     

The Impact of Seed Policy Reforms and Intellectual Property Rights on Crop Productivity in India

The growth of private investment in developing‐country agriculture, new advances in the biological sciences, and rapid integration of developing countries into the global trading system has heightened interest in the topic of seed market and intellectual property rights’ (IPRs) policies among public policy‐makers, corporate decision‐makers and other actors in the agricultural sector. But there are still unanswered questions about whether emerging and evolving seed policy reforms and IPR regimes in developing countries will contribute to increasing crop productivity and improving food security. This paper attempts to answer some of these questions by focusing specifically on the case of India, the regional leader in implementing seed policy reforms and IPRs in agriculture. Findings indicate that maize and pearl millet yields grew significantly during the last two decades due partly to the combination of (1) public policies that encouraged private investment in India’s seed industry during the 1980s, and (2) biological IPRs conferred by hybridisation that conveniently married the private sector’s need for appropriability with the nation’s need for productivity growth. Although past lessons are not an indication of future success, this convergence of policy solutions and technology opportunities can be replicated for other crops that are vital to India’s food security.     

Sharecropping efficiency in Ethiopia: threats of eviction and kinship

We tested a theoretical model with the Marshallian inefficiency (H1) and threat of eviction (H2) hypotheses having opposite effects on land productivity on sharecropped plots. The model also assumes that kinship contracts may eliminate or reduce the Marshallian inefficiency (H3) and threat of eviction (H4) effects on land productivity. Our empirical findings were consistent with H2 and H4 being true. We found higher land productivity on sharecropped plots than on share tenants' own plots and higher land productivity on sharecropped plots of nonkin than of kin tenants. The nature of the data allowed controlling for unobservable household characteristics through household fixed effects and for observable plot characteristics. Analyses with and without plot characteristics revealed that these findings were stronger with plot characteristics than without them. Based on the plausible assumption that observable plot characteristics are positively correlated with unobservable plot characteristics this strengthens our conclusion. The results are also supported by first-order stochastic dominance analysis. Sharecropped plots' output value distribution unambiguously dominated the output value distribution from share tenants' own plots. Nonkin sharecropped plots' output value distribution also first-order stochastically dominated the output value distribution from kin sharecrop plots.     

如何有效提高家庭农场的全要素生产率 ——基于上海市松江区家庭农场数据的实证分析

研究目的：基于上海松江区家庭农场的调查数据计算家庭农场的全要素生产率，离析出影响家庭农场全要素生产率的关键因素，据以提出有针对性的措施。研究方法：Global Malmquist和混合Tobit模型。研究结果：（1）2007—2017年，全部家庭农场全要素生产率指数为1.077 3，其中，纯效率变化指数为0.998 4、技术变化指数为1.075 0、规模效率变化指数为1.007 2；纯粮食种植型家庭农场全要素生产率指数为1.061 9，纯效率变化指数为0.989 6，技术变化指数为1.071 9，规模效率变化指数为1.004 6；其他类型家庭农场全要素生产率指数为1.081 7，其中，纯效率变化指数、技术变化指数和规模效率变化指数分别为1.027 9、1.049 0和1.014 0。（2）总体水平上，农场主是否有农业从业经历、是否有农机驾驶证、土地经营权合同年限、是否购买农机作业正向影响全部家庭农场的全要素生产率，但不同类型家庭农场全要素生产率的影响因素存在差异。研究结论：虽然松江家庭农场全要素生产率增长速度较快，但仍然存在一定的提升空间。为此，需要提高家庭农场劳动力素质，切实保障好家...     

Assessing the impact of NERICA on income and poverty in central and western Uganda

Persistent food shortage and poverty in sub-Saharan Africa (SSA) are major development issues. New Rice for Africa (NERICA) was developed to boost crop yield and income of rural households in SSA. Although its high-yielding traits have become fairly well known, there is no empirical analysis of its impact on income and poverty. By taking the case of Uganda where a NERICA promoting program was initiated as one of the major poverty eradication measures, this study attempts to compare actual income with the hypothetical income without NERICA. We found that introduction of NERICA decreases poverty to a significant extent without deteriorating income distribution.     

Modelling the Crop Variety Demand of Semi‐Subsistence Households: Bananas in Uganda

We propose an approach to model the derived demand for crop varieties among semi‐subsistence farmers in a developing economy, and apply it to smallholder banana producers in Uganda. We model variety planting decisions as being composed of an extensive margin decision to grow a subset of locally available varieties (variety choice); and an intensive margin decision about the scale or extent of variety cultivation per farm (variety demand). We estimate variety demand equations using a more complete representation of the choice set upon which observed planting decisions are made. Computed elasticities of variety demand with respect to variety attributes indicate that the relative importance of consumption and production attributes varies by location and proximity to markets, from which we draw implications for the social and economic impact of crop improvement. The approach that we propose has broad appeal for analysing adoption decisions for modern or traditional varieties of both major and minor crops in developing countries.     

China’s Agricultural Policy Transition: Impacts of Recent Reforms and Future Scenarios

This article reviews recent developments in China’s agricultural domestic support policy, especially the transition from taxing farmers and agriculture to providing direct subsidies to grain production and purchased inputs. A model‐based quantitative analysis on the effects of these policy changes is presented. Simulation results suggest that recent policy changes have achieved the declared policy goals of increasing grain production and boosting farm income. Much of the increase in grain production and farm income can be attributed to higher per unit return to arable land, land reallocation to grain production and extra agricultural employment triggered by the policy changes. Based on the assumption that China’s public assistance to agriculture and farmers will continue and rise, two hypothetical future scenarios are simulated. Using all the support permitted under WTO de minimis limits with existing instruments, China’s policy will increase grain production, change trade patterns seemingly contrary to China’s comparative advantage, increase rural employment and significantly increase farm income (by more than 12%). If, however, decoupled instruments are applied to raise China’s agricultural domestic support to the same level, China’s agricultural production and trade will remain unchanged, rural employment remain stable, but farm income will be increased by nearly 15%.     

The impact of decoupled subsidies on productivity in agriculture: a cross‐country analysis using microdata

The decoupling of direct payments from production introduced in the reform of the Common Agricultural Policy is expected to make production decisions more market‐oriented and farmers more productive. However, ex‐post analyses of the productivity of farms have yet to uncover any evidence of a positive impact of the decoupling policy on farm productivity. Using Irish, Danish, and Dutch farm‐level data, we identify whether the decoupling policy has contributed to productivity growth in agriculture and farm product adjustment behavior. We find some evidence that the decoupling policy had significant positive effects on farm productivity and behavioral changes related to farm specialization.     

Gender and agriculture in sub‐Saharan Africa: introduction to the special issue

This special issue contributes to the literature on gender differences in sub‐Saharan African agriculture primarily by using new and innovative micro‐data. The first six articles have a strong focus on understanding the extent and drivers of gender differences in land productivity and use data from nationally representative household surveys that are implemented under the Living Standards Measurement Study‐Integrated Surveys on Agriculture (LSMS‐ISA) initiative. The LSMS‐ISA data are multi‐topic, with geo‐referenced household and plot locations, and information on production and identity of managers and owners at the plot level. The last two articles in the volume rely on in‐depth quantitative and qualitative case study data, which, in combination with the nationally representative data, allow for greater insights into the extent and correlates of gender differences in sub‐Saharan African agriculture. While there does seem to be persistent evidence of gender gaps, the studies find the sources of these gaps to vary within and across countries. This makes designing policies to address gender gaps more challenging, yet of crucial importance. What is clear is that the failure to directly and explicitly address the underlying causes of the disparities is likely to end up exacerbating the observed gender gaps.     

Impacts of Animal Well‐Being and Welfare Media on Meat Demand

This article provides the first known examination of how animal welfare information provided by media sources impacts beef, pork and poultry demand. Results suggest that media attention to animal welfare has a small, but statistically significant impact on meat demand. Long‐run pork and poultry demand are hampered by increasing media attention whereas beef demand is not directly impacted. Loss in consumer demand is found to come from exiting the meat complex rather than spilling over and enhancing demand of competing meats. An outline of economic implications is provided for the broader discussion of animal welfare.     

Productivity and Producer Welfare in the Presence of Production Risk

Production risk is an inherent characteristic of agriculture and changes in production risk will affect the welfare of risk‐averse producers. Using standard concepts from the literature on uncertainty, we introduce a welfare measure which comprises total factor productivity (TFP), production risk and farmer risk preferences, and which reflects the impact on producer welfare of changes in production technology. An empirical application is carried out using data from a sample of Spanish dairy farms which shows how the positive impact of increases in TFP on welfare can be offset by increases in the risk premium (‘cost of risk’) to the point where welfare may decrease.     

Impacts of changing water inflow distributions on irrigation and farm income along the Drâa River in Morocco

Irrigation water is essential for agriculture in the arid Drâa River basin in Morocco but climate change leads to increasingly unreliable water supply in the area. This article analyzes impacts of changing water inflow distributions on irrigation and farm income extending a conjunctive river basin model toward a stochastic modeling approach. Regional climate scenarios are used to derive a maximum likelihood density estimate of current and future water supplies. Based on these distributions, Monte Carlo simulations are performed to obtain stochastic model results on surface and groundwater irrigation as well as economic indicators for six oases along the river. The probability of farmers to receive revenues below the subsistence level is around 2% under current conditions, but this is likely to rise to rates of 6% to 15% depending on the underlying climate change scenario. The composition of water sources for irrigation will shift to more groundwater use. The river basin model is able to represent complex spatial interactions between oases as well as a partial complementarity between groundwater and surface water irrigation due to salinity management effects. Interestingly, the value of groundwater is not necessarily increasing under future climatic conditions as salinity problems are aggravated with expanded groundwater use.     

Enhancing food security in South Sudan: the role of markets and regional trade

South Sudan faces serious problems of food insecurity due to low levels of domestic food production, periodic droughts, widespread poverty, and since late 2013, renewed armed conflict. This article explores market price behavior using cointegration analysis and estimates the effects of production and trade shocks through multimarket model simulations. We show that market prices in the capital city, Juba, of both maize and sorghum are cointegrated with import parity prices of these cereals sourced from Uganda, consistent with observed trade flows. Model simulations, using econometrically estimated demand parameters, suggest that private sector imports of maize and wheat would greatly mitigate the potential fall in consumption in the case of a decline in domestic cereal production. Other simulations indicate that if total imports of cereals are reduced by one‐third (still more than two times the levels of food aid in 2013) because of disruptions to private market flows, domestic prices of cereals could rise by 45% or more. The article concludes that whatever measures are taken involving national food security reserves, it is crucial that government policy serves to maintain incentives for private sector imports to avoid destabilizing market supplies, domestic prices, and ultimately, food consumption of the poor.     

Impacts of price and productivity changes on banana‐growing households in Uganda

This article compares the effects of changing market prices and farm productivity on the welfare of banana‐growing households in the Ntungamo district of Uganda. A heterogeneous‐agent model is applied via a series of mathematical optimization problems, to simulate production and consumption responses of 70 farm households surveyed in 2006. Results show that a given increase in productivity has a greater impact on poverty alleviation than that same increase in market prices. Despite the effects of productivity gains being comparable across different types of household groups, price improvements primarily benefit the incomes of households who are involved in rural producer organizations, who are located closer to markets, and who sell at the market.