Are Production Decisions Decoupled under a Bond Scheme? Experimental Evidence

Experimental economics procedures were used to investigate impacts of a proposed bond scheme on production decisions. As expected, production with subsidy payments tied to a support price was substantially higher than with no policy. A shift from the support price to equivalent annual or lump-sum payments not tied to price resulted in production at or near no-policy levels, providing empirical evidence to support the theoretical prediction that bond schemes would not result in production distortions. Potential extensions to the basic model used in this study also are presented.     

CAP Reform: Prospects for crop markets in the Enlarged EU: Reform der GAP: Aussichten für die Märkten von Feldfrüchten in der erweiterten EU: La rëforme de la PAC: I'avenir des marchés agricoles dans I'Europe élargie

CAP Reform: Prospects for crop markets in the Enlarged EU Agricultural Policy Modelling in the EU has become more complicated due to the recent CAP reform and EU Enlargement. Under the AGMEMOD (Agricultural Member States Modelling) Partnership, teams of economists with specialist knowledge of agriculture in their own countries have come together to build the AGMEMOD model. The model can be used to analyse the impact of policy reform at a country level in EU member states and at an aggregate EU level. The model covers a wide variety of agricultural commodities, but this article focuses specifically on the impact of the policy reform on the cereals sector. Results are presented for the EU15 in aggregate, the New Member States (NMS), Bulgaria and Romania. The implication of EU Enlargement is also examined for the accession countries. For the EU15, results suggest that there would be a modest reduction in grain production and a slightly larger reduction in oilseeds production by 2010, as a response to the decoupling of cereal payments. Results for the NMS suggest that their accession will bring some modest growth in grains production by 2010, This result is not greatly different from that which might have been achieved had these countries remained outside the EU. The recent reforms limit the extent to which the CAP stimulates increased production in the NMS. La réforme de la PAC: l'avenir des marches agricoles dans l'Europe élargie Avec l'elargissement et la recente reforme de la PAC, modeliser la politique agricole europeenne devient de plus en plus difficile. C'est pour cela que plusieurs Cquipes d'kconomistes ‐ chacune selectionnee sur la base de ses connaissances accumulees sur l'agriculture de son propre pays ‐ se sont associees pour construire le modele AGMEMOD, dans le cadre du partenariat MAEM (Modelisation Agricole des Etats Membres). Ce modkle est utilisable pour analyser l'impact des reformes de la politique agricole, tant au niveau de l'Europe entiere qu'i celui de chacun des Etats membres. Il couvre une vaste variete de produits agricoles, mme si le present article met I'accent sur les cereales. k s resultats sont prksentes pour les agrigats ‘Europe a 15’, ‘NMS’ (nouveaux ktats membres), Bulgarie et Roumanie. On examine aussi, ici, les implications de I'elargissement de I'Union pour les nouveaux membres. Pour 1'Europe a 15, a la suite du dkcouplage des aides cerealieres, les resultats conduisent i envisager a I'horizon 2010 une modeste reduction de la production de cereales et une reduction un peu plus forte de la production dolkagineux. Dans le mCme temps, les NMS devraient connaitre un faible accroissement de leur production de cereales. Ceci n'est pas fondamentalement different de ce qui serait arrive si ces pays etaient restes en dehors de 1'Europe. Dans les NMS, les reformes recentes ont pour effet de brider les accroissements de production auxquels I'application de la PAC aurait permis de s'attendre. Reform der GAP: Aussichten für die Märkte von Feldfruchten in der erweiterten EU Die Modellierung von Agrarpolitiken in der EU gestaltet sich auf Grund der kurzlich durchgefiihrten Reform der GAP und der EU‐Erweiterung zunehmend schwieriger. Im Rahmen der AGMEMOD (Agricultural Member States Modelling, Agrarmodellierung von Mitgliedstaaten)‐Partnerschaft haben sich Okonomen zusammengefunden, die im Hinblick auf die Landwirtschaft in ihren Heimatlandern uber Fachkenntnisse verfiigen, um das AGMEMOD‐Modell zu erarbeiten. Mit Hilfe dieses Modells konnen die Auswirkungen der Politikreformen sowohl auf Ebene der EU‐Mitgliedstaaten als auch auf aggregierter EU‐Ebene analysiert werden. Das Modell deckt eine groRe Anzahl von landwirtschaftlichen Produkten ab; dieser Artikel behandelt jedoch insbesondere die Auswirkungen der Politikreformen auf dem Getreidesektor. Die Ergebnisse werden fiir die aggregierte EU‐15, die neuen Mitgliedstaaten (NMS) sowie fiir Bulgarien und Rumanien dargestellt. Die Auswirkungen der ELI‐Erweiterung werden ebenfalls ftir die Beitrittslander untersucht. Im Fall der EU‐15 zeigen die Ergebnisse einen geingen Ruckgang bei der Getreideproduktion und einen etwas hoheren Ruckgang bei der Olsaatenproduktion bis zum Jahr 2010 als Folge der Entkopplung der Getreidezahlungen. Die Ergebnisse fiir die NMS deuten darauf hin, dass sich ein geringes Wachstum der Getreideproduktion bis zum Jahr 2010 ergeben wird. Dieses Ergebnis unterscheidet sich nicht wesentlich von einem Szenarium, in welchem diese Lander der EU nicht beigetreten waren. Die kurzlich durchgefiihrten Reformen begrenzen die produktionssteigernde Wirkung der GAP in den NMS.     

A small continuous time macro-econometric model of the Czech Republic

In this paper we estimate a continuous time macro-econometric model of the Czech economy. The model is built as a system of twelve non-linear differential equations. We illustrate how the model can be used to determine the nominal equilibrium exchange rate of the Czech koruna in a macro-economic framework. The paper also investigates the effectiveness of monetary and fiscal policies in the presence of a fixed exchange rate regime and massive capital inflows. The search for an equilibrium path is outlined and stability and sensitivity analyses are provided, along with in-sample static and dynamic predictions with the approximate discrete analogue.     

Expected Precision of Estimation and Probability of Ruling Out a Hypothesis Based on a Confidence Interval

Interval estimation is an important objective of most experimental and observational studies. Knowing at the design stage of the study how wide the confidence interval (CI) is expected to be and where its limits are expected to fall can be very informative. Asymptotic distribution of the confidence limits can also be used to answer complex questions of power analysis by computing power as probability that a CI will exclude a given parameter value. The CI‐based approach to power and methods of calculating the expected size and location of asymptotic CIs as a measure of expected precision of estimation are reviewed in the present paper. The theory is illustrated with commonly used estimators, including unadjusted risk differences, odds ratios and rate ratios, as well as more complex estimators based on multivariable linear, logistic and Cox regression models. It is noted that in applications with the non‐linear models, some care must be exercised when selecting the appropriate variance expression. In particular, the well‐known ‘short‐cut’ variance formula for the Cox model can be very inaccurate under unequal allocation of subjects to comparison groups. A more accurate expression is derived analytically and validated in simulations. Applications with ‘exact’ CIs are also considered.