European Review of Agricultural Economics

Published by Oxford University Press (OUP)
Online ISSN: 1464-3618
Print ISSN: 0165-1587
The availability of manpower has always been crucial for large-scale agriculture. Competing for labour with urban sectors, large tenant farmers of Brie (just east of Paris) employed from the mid-nineteenth century onward an increasing number of migrant workers drawn from the peasant economy. But these workers seldom remained in Brie. This instability was the result of the wage level: agricultural wages were much lower than the industrial wages and were therefore insufficient to keep the workers on the farms. Labour claims were unable to fill the gap so that the loss of agricultural labour continued and manpower had to be constantly renewed.
The theme of the 18th International Conference of Agricultural Economists held in Jakarta/Indonesia in 1982 was ‘growth and equity in agricultural development’. The central problem of the conference, which was extensively discussed in general, as well as in very detailed or applied papers, centred around the question of whether or not a trade-off between growth and equity might occur and, if so in what situations this might be the case and what should be done if growth negatively affects equity. The general trend of the papers presented during the conference was that there is very often no trade-off between growth and equity. In some cases, however, when a trade-off exists it is preferable to enhance growth rather than inhibit it, because growth is a necessary prerequisite for governments in order to finance measures which could achieve equity goals. This is especially true as far as technical progress is concerned. Another generally accepted finding was that measures of agricultural policy which influence the price relations not only cause welfare losses but also very often show adverse effects on distribution, and are thus jeopardizing to both growth and equity.
The purpose of this paper is to examine consumption patterns of the Greek consumer for agricultural and non-agricultural commodities by estimating a complete system of expenditure equations. The estimated expenditure and price elasticities of demand show that demand for agricultural commodities is income and price inelastic and that for non-agricultural commodities it is income-elastic but price-inelastic. The cross-price effects, both compensated and uncompensated, appear to be strong between agricultural and non-agricultural commodities and less significant among the agricultural commodities by themselves.
This study uses input-output tables in real terms for analyzing growth and structural change in different sectors of selected EU economies in the 1960s and 1970s. The input-output model is used as a common framework to isolate and interrelate different elements of structural change and to calculate their total (direct and indirect) effects. The sources of changes in output are then broken down into their components of consumption, export, investment, import substitution and intermediate demand. The growth of consumption and foreign trade became increasingly important sources for output growth, and especially for agriculture, in all the EU countries examined. Copyright 1995 by Oxford University Press.
This paper deals with the role of public research in Italian agriculture during the period 1960--1995. A short-run Generalised Leontief cost function capable of accommodating quasi-fixed factors and variable returns is used. Temporary equilibrium and scale economies are investigated with special emphasis on the methodological implications of R&D stock and the consistency of the estimated model with microeconomic theory. Comparing the relevant shadow and rental price provides evidence on under- (over)-investment and the rationale driving public research expenditure in agriculture. A formal test of the induced innovation hypothesis and the calculation of the internal rate of returns are also presented. Copyright 2003, Oxford University Press.
This article deals with the role of public research in Italian agriculture during the period 1960 to 1995. A short-term specification of the GL cost function capable of accommodating quasi-fixed factors and variable returns is employed. Temporary equilibrium and scale economies are investigated with special emphasis on methodological implications of R&D stock and;consistency of the estimated model with microeconomic theory. Confronting the relevant shadow and rental price the model provides evidence on the topics of under (over) investment and the rationale driving public research expenditure in agriculture A formal test for the induced innovation hypothesis, the calculation of the internal rate of returns and TFP growth decomposition are also considered.
Summary The purpose of this paper is to present estimates of the level and trends of agricultural protection in Sweden during the years 1970–80. Protection increased from 70% ad valorem tariff equivalent during 1970–72 to 80% during 1976–80. Dairy products and beef were particularly highly protected. Protection could not be measured by variable levies only. Price subsidies and the negotiating element in decisions on levies made direct price comparisons necessary. Approximate effective rates of protection were also estimated. Both nominal and effective rates were found to be lower than in the EC. Finally, the national defense argument about self-sufficiency in food supply was compared with present levels of production and the total cost of surplus production was estimated.
This paper reviews and analyzes the empirical record of exchange rates and prices during the 1970's and the analysis is based on the experience of the Dollar/Pound, the Dollar/French Franc and the Dollar/DM exchange rates. Section 2 presents the evidence on PPP during the 1970's and contrasts it with the evidence from the 1920's -- a period during which the doctrine held up reasonably well. This analysis is relevant for assessing whether the flexible exchange rate system was successful in providing national economies with an added degree of insulation from foreign shocks, and whether it provided policymakers with an added instrument for the conduct of macroeconomic policy. The evidence regarding deviations from purchasing power parities is also relevant for determining whether there is a case for managed float. Section 3 attempts to explain what went wrong with the performance of the doctrine during the 1970's. It examines the hypothesis that the departures from PPP are a U.S. phenomenon, as well as the hypothesis that the departures are due to large changes in inter-sectoral relative price changes within the various economies. Given that the predictions of the simple versions of PPP do not hold up, section 4 proceeds in examining the question of whether national price levels have been independent of each other. Section 5 addresses the question of whether exchange rates and national price levels are comparable and whether in principle one should have expected them to be closely linked to each other. The main point that is being emphasized is that there is an important intrinsic difference between exchange rates and national price levels which stems from the basset market theory' of exchange rate determination. This theory implies that the exchange rate, like the prices of other assets, is much more sensitive to expectations concerning future events than national price levels and as a result, in periods which are dominated by news' which alter expectations, exchange rates are likely to be much more volatile than national price levels and departures from PPP are likely to be the rule rather than the exception. Finally, section 6 concludes the paper with some policy implications.
Entry to the European Economic Community in 1973 brought about fundamental changes in the policy instruments applied to the United Kingdom's cereal sector. Prior to entry, grain prices were largely determined by the price of imported cereals, and farmers' revenue was protected by a system of Deficiency Payments. Once in the ECf the UK market was supported by market intervention, with the price of imports raised by a variable import levy. This period of change provided a unique opportunity to examine a commodity market undergoing a fundamental change in terms of institutional management and price behaviour. The investigation proceeds by first suggesting several anticipated developments in the period 1973–1979. The observed behaviour of the markets is then investigated using causality tests and spectral analysis. The expected behaviour is compared with the results, and conclusions are drawn about the effects of the institutional management of the market.
Using Family Expenditure Survey data for five survey years over the period 1973 to 1993, a Box-Cox double-hurdle model of the participation and expenditure decisions regarding meat consumption has been estimated. Particular attention has been given to single-adult households. The effects of socioeconomic characteristics on meat demand decisions are shown to have varied quite markedly over this period but some trends, particularly with respect to the age and gender of the householder, are discernible. Copyright 1996 by Oxford University Press.
The net benefits of the application of the CAP have been one of the most celebrated arguments for Greece's full membership in the Common Market. Estimates of the budgetary effects presented both before and after full membership have been used to support this thesis. Direct income transfers between consumers and producers located in different countries have not been taken into account. In this paper, we present the total (direct and budgetary) income transfers between Greece and the other EC countries in 1981, the first year of its accession to the Community. It is shown that although Greece has had a net budgetary benefit, the direct income transfers between Greek consumers and EC producers have been much larger than the corresponding transfers from EC consumers to Greek producers. The negative balance of the latter has outweighed the positive balance of the former leaving a net loss of about 115 million ECU for Greece.
Summary At this conference, it was pointed out that the problems of the agricultural sectors become more complex because of the increasing market and policy interdependencies between countries and also between agriculture and the general economy. Additionally, the imbalance between overproduction and malnutrition needs more attention, and the interdependencies between the agricultural and economic system on one hand and the environmental and ecological system on the other hand become more important for agricultural economists. From the increasing interdependencies and complexity of agriculture in a turbulent world, various policy requirements and conclusions for further research have been drawn. Among others, the linkages between micro and macro considerations should be stressed, the interdisciplinary character in applied research should lead to a closer collaboration between various research and finally adequate research methods and approaches should be developed and confronted with the more complex phenomena of the real world.
Résumé This paper reviews the international assistance provided to Hungary in the period from early 1990 to mid 1993. In the first part, aid is described as generally useful and purposeful, but — except in the area of macro-economic stabilisation-of less weight and impact than expected in both East and West. Moreover, it has been demanding in terms of financial servicing, labour intensity and conditionality. The second part provides an assessment of aid. The paper argues that thereis a gap between the longer term, strategic motivation of aid and actual aid implementation. Also, the assistance has not been properly focused. While aid has addressed the issues of restructuring, capital needs and macro-economic stabilisation, it has not sufficiently served access to markets and information transfer, communications and facilitation of decision making. The article further makes the point that aid delivery is slow, costly and not fully effective. In conclusion, six areas for international action are identified.a
Summary A multi-commodity model of world food markets is used to show the likely effects of a gradual lowering of tariffiad agricultural protection rates by industrial countries during the 1990s. In addition to raising the mean and lowering the variance of international food prices, such reforms bestow large economic benefits on both reforming and traditional food-exporting countries. And, contrary to the fears of many in protective countries, there is no massive shrinkage of the reforming rural sectors. Instead, the disincentive effect of reform on food production simply slows the output expansion resulting from normal productivity growth. Keywords: agricultural protection, food policy, tariffication, trade liberalisation.
The countries of East Central Europe and the former Soviet Union have achieved considerable progress with land reform and farm restructuring since 1991. Yet the achievements fall short of original expectations, both in scope and in character. So far, agricultural transformation has not produced a quick increase in production; most land remains in collective ownership; most peasants prefer to remain in the safety of large cooperatives, which still dominate agriculture. The accomplishments of agrarian reform have been modest due to political and legal uncertainty, lack of a supportive environment, high risk, and inadequate mechanisms for farm restructuring and individual exit. The future agriculture in the region will be characterised by the coexistence of private farms, restructured cooperatives, commercial farms of various sizes, and part-time subsistence farms.
Observed expenditure shares
Descriptive statistics Before 1996 crisis After1996 crisis
shows the p-
Average estimated expenditure shares Beef Poultry Fish Other meats s t = 1;
the Lagrange multiplier test results, performed at 5% level of signif- icance. 14 First, we test whether we can omit Markovian and no Markovian lagged expenditure shares in a MS-AIDS characterized by Markovian constant terms and sea- sonal dummies (models 3a and 3b). The null hypothesis for both tests is strongly
A time-varying coefficient demand system, the Markov switching almost ideal demand model, is proposed to shed new light on change over time in the structure of French meat and fish demand. The main feature of this model is that the switching mechanism from one structure of demand to the other is controlled by an unobserved variable that follows a Markov chain. Our model accurately captures the two Bovine Spongiform Encephalopathy (BSE) crises of recent years. We estimate that the 1996 BSE crisis lasted almost three years, whereas the second BSE crisis for just lasted five 4-week periods.
This paper uses data envelopment analysis to compute overall technical and input-specific technical efficiency measures of conventional and organic farms in Finland. Moreover, productivity measures are determined, indicating differences in technology employed by organic and conventional farms. The data are from crop and livestock farms over the period 1994--1997. The results show that organic farms are on average more efficient relative to their own technology, but use a less productive technology than conventional farms. Copyright 2002, Oxford University Press.
This paper discusses the linkages among the different obligations entailed in the GATT Agreement on Agriculture. It is shown that each country's choice between feasible policy alternatives crucially depends on the analogous choices made by other countries. This means that there is a game structure inherent in the GATT implementation process. Any modelling effort aimed at forecasting the implications of implementing the GATT Agreement which does not take into consideration the linkages among the various commitments, the policy choices to be made by each country, or the game structure inherent in the implementation process, is likely to yield incorrect results.
Summary The paper describes how long-term forecasts of the Common Agricultural Policy (CAP) can be generated using qualitative information. Following an explanation of the methodology adopted, the discussion focuses on the analysis of a Delphi survey on the future of the CAP, carried out between January and August, 1986. The results illustrate a number of contrasting characteristics typical of Delphi surveys, in particular, the problems associated with communicating complex and often complicated concepts and the trade-off which exists between accuracy and efficiency in conducting a survey of this kind. The forecasts cover a number of issues and include probability estimates of specific events (re-nationalisation of the CAP, enlargement of the EC, introduction of majority voting, increase in ‘own resources’, maintenance of dairy quotas), the identification of key issues and future policy developments, and numerical forecasts of budgetary expenditure, farming incomes and the level of price support in 1995.
This paper examines the compatibility of the Agenda 2000 reform of the Common Agricultural Policy (CAP) of the European Union (EU) with the EU's commitments to reduce export subsidies made under the GATT Uruguay Round Agreement on Agriculture. A multi-region applied general equilibrium model, which includes relevant CAP measures, is used to obtain a quantitative assessment and to analyse the effects of alternative world market price changes on the fulfilment of these commitments. We show that Agenda 2000 helps the EU to remain within its export subsidy commitments, but to a lesser extent within its export volume constraints. Furthermore, conclusions with regard to export subsidies depend on the world market situation. A forward-looking analysis that anticipates the WTO Doha Round indicates that further adjustments to the CAP are inevitable. Copyright 2002, Oxford University Press.
Top-cited authors
Klaus G Grunert
  • Aarhus University
Alfons Oude Lansink
  • Wageningen University & Research
Johan Swinnen
  • International Food Policy Research Institute
Hans C. M. van Trijp
  • Wageningen University & Research
Jan-Benedict Steenkamp
  • University of North Carolina at Chapel Hill