The impact of decoupled subsidies on productivity in agriculture: A cross-country analysis using microdata

Andrius Kazukauskas, Carol Newman, Johannes Sauer

Research output: Contribution to journalArticlepeer-review

50 Scopus citations

Abstract

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.

Original languageEnglish
Pages (from-to)327-336
Number of pages10
JournalAgricultural Economics
Volume45
Issue number3
DOIs
StatePublished - May 2014
Externally publishedYes

Keywords

  • Productivity, Subsidy decoupling
  • Semiparametric estimation
  • Specialization
  • Switching

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