GTAP Resources: Resource Display
| GTAP Resource #4121 |
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"Green Light for Green Agricultural Policies? An Analysis at Regional and Global Scales" by Britz, Wolfgang, Thomas Hertel and Janine Pelikan Abstract In its recent proposal for a reformed Common Agricultural Policy (CAP), the EU Commission included a minimum farm-level share of ‘ecological focus area’ as one of several compulsory measures for receiving direct income support under the CAP. This study analyzes the effects of introducing a biodiversity-targeted program for ecological focus area on all farms with arable land in the EU by quantifying its global and regional, economic and environmental impacts in a mutually consistent way. This is challenging due to the differing spatial scales of the problem – ranging from on-farm decisions regarding set-aside in the EU, to supply response around the world in the face of higher world prices. In order to address this challenge, we combine the supply side of the CAPRI model, which offers high spatial, farm and policy resolution in the EU, with the GTAP model of global trade and land use. Both models are linked through a multi-product, restricted revenue function for the EU crops sector which we incorporate into GTAP. Importantly, the CAPRI-estimated parameters of that function cover produce aggregate EU crop supply equations which depend both on crop prices and input levels, as well as a variable capturing the intensity of set-aside requirements, thereby offering a lever by which to simulate this EU policy within the GTAP global model. The results predict improved environmental status in the high yielding regions of the EU. However, price increases trigger intensification in the more marginal areas of Europe where little or no additional land is taken out of production. At global scale, there is interaction between the EU-set-aside policy and land use in the rest of the world. We find that the loss of 3.7 Mio ha of arable land in the EU is partially compensated by an increase of 0.4 Mio ha in other regions of the globe, as well as increased fertilizer applications. Thus, the improvement of environmental status in the EU comes at the price of global intensification. |
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- Land use - Trade and the environment - Agricultural policies - European Union |
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Public Access  GTAP Resource 4121 (1.8 MB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 2:05:45 PM
