The Reform of the Common Agricultural Policy

238 Pages·1998·36.89 MB·English

by  K. A. Ingersent, A. J. Rayner, R. C. Hine (eds.)

THE REFORM OF THE COMMON
AGRICULTURAL POLICY
Also by K. A. lngersent
AGRICULTURE AND ECONOMIC DEVELOPMENT
(with S. Ghatak)
AGRICULTURE AND THE URUGUAY ROUND (with A. J. Rayner
and R. C. Hine)
ECONOMIC ANALYSIS OF AGRICULTURE (with B. E. Hill)
Also by A. J. Rayner
AGRICULTURE AND THE URUGUAY ROUND (with K. A. lngersent
and R. C. Hine)
CURRENT ISSUES IN AGRICULTURAL ECONOMICS
(with D. Colman)
RESOURCE STRUCTURE OF AGRICULTURE (with K. Cowling and
D. Metcalf)
Also by R. C. Hine
AGRICULTURE AND THE URUGUAY ROUND (with A. J. Rayner
and K. A. lngersent)
GLOBAL PROTECTIONISM
THE POLITICAL ECONOMY OF EUROPEAN TRADE
The Reform of the
Common Agricultural
Policy
Edited by
K. A. Ingersent
Senior Research Fellow
Centre fo r Research in Economic Development
and International Trade
University ofNottingham
A. J. Rayner
Prof essor ofAgricultural Economics
University ofNotti ngham
and
R. C. Hine
Senior Lecturer in Economics
University ofNottingham
First published in Great Britain 1998 by
MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG21 6XS and London
Companies and representatives throughout the world
A catalogue record for this book is available from the British Library.
ISBN 978-1-349-26103-1 ISBN 978-1-349-26101-7 (eBook)
DOI 10.1007/978-1-349-26101-7
First published in the United States of America 1998 by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division,
175 Fifth Avenue, New York, N.Y. 10010
ISBN 978-0-312-21009-0
Library of Congress Cataloging-in-Publication Data
The reform of the common agricultural policy I edited by K. A.
lngersent, A. J. Rayner, and R. C. Hine.
p. em.
Based on a one-day conference held in March 1996 at the University
of Nottingham, under the auspices of the Centre for Research in
Economic Development and International Trade (CREDIT).
Includes biblio~raphical references and indexes.
ISBN 978-0-312-21009-0 (cloth)
1. Agriculture and state-European Union countries-Congresses.
I. lngersent, K. A. II. Rayner, A. J. Ill. Hine, R. C.
HDI918.R43 1998
338.1'84-dc21 97-28031
CIP
Selection, editorial matter and Chapters I and I 0 © K. A. lngersent, A. J. Rayner and
R. C. Hine 1998
Chapter 6 © R. W. Ackrill, R. C. Hine and A. J. Rayner 1998
Chapters 2-5 and 7-9 © Macmillan Press Ltd 1998
Softcover reprint of the hardcover 1st edition 1998 978-0-333-68771-0
All rights reserved. No reproduction, copy or transmission of this publication may be made
without written permission.
No paragraph of this publication may be reproduced, copied or transmitted save with
written permission or in accordance with the provisions of the Copyright, Designs and
Patents Act 1988, or under the terms of any licence permitting limited copying issued by
the Copyright Licensing Agency, 90 Tottenham Court Road, London WIP 9HE.
Any person who does any unauthorised act in relation to this publication may be liable to
criminal prosecution and civil claims for damages.
The authors have asserted their rights to be identified as the authors of this work in
accordance with the Copyright, Designs and Patents Act 1988.
This book is printed on paper suitable for recycling and made from fully managed and
sustained forest sources.
10 9 8 7 6 5 4 3 2 1
07 06 05 04 03 02 01 00 99 98
Contents
List of Tables Vll
List ofFigures ix
Preface x
Notes on the Contributors Xl
List ofAbbreviations xiii
1 Introduction and Overview
K. A. Ingersent, A. J. Rayner and R. C. Hine
2 An Ex-post Review of the 1992 MacSharry Reform 12
Stefan Tangermann
3 Agricultural Policy Reform in the USA and the EU: A
Comparison of CAP Reform and the 1996 US Farm Bill 36
Tim Josling
4 Implications of the EU East Enlargement for the CAP 54
Monika Hartmann
5 Modelling the Outcomes of CAP Reform 76
William H. Meyers, Michael D. Helmar and Chad E. Hart
6 CAP Reform and Implications for Member States:
Budget and Trade Effects 104
R. W Ackrill, R. C. Hine and A. J. Rayner
7 The CAP and the Environment 132
Michael Winter
8 The Reform of the CAP and its Impact on Consumers 156
S. M cCorriston and C. W Morgan
9 The CAP and the WTO after the Uruguay Round
Agriculture Agreement 175
Kenneth J. Thomson
v
VI Contents
10 Postscript 189
K. A. Ingersent, A . J. Rayner and R. C. Hine
Notes and References 200
Bibliography 208
Author Index 218
Subject Index 221
List of Tables
1.1 The CAP: agricultural budget expenditure and import
levy receipts 2
3.1 FAIR timeline 40
3.2 Agricultural market transition programme (FAIR, Title 1) 42
3.3 Trade provisions of the Farm Bill (FAIR, Title II) 43
3.4 Conservation provisions of the Farm Bill (FAIR,
Title III) 44
3.5 Comparison of MacSharry reform (1992) with US FAIR
Act (1996) 45
4.1 Importance of agriculture in the CEECs and the
EU-15 (1993) 56
4.2 Comparison of agriculture in the CEECs and the EU-15 57
4.3 Agricultural producer prices in selected countries of
Central and Eastern Europe relative to equivalent prices
in the EU-15 (1994) 59
4.4 Comparison of agricultural protection in the EU-12 and
selected CEECs (1994) 61
4.5 Agricultural prices and wages in the CEECs relative to EU
prices and output/input price structure in the CEECs
relative to the EU (1994) 62
4.6 Gross agricultural productivities in the CEECs and the EU 64
4.7 Absolute and relative labour productivity and intensity of
labour use in agriculture (1993) 66
4.8 Determinants of food demand in the CEECs and the
EU-15 (1993) 69
4.9 Budgetary effects of EU East enlargement 72
5.1 Assumptions of the baseline and CAP reform scenarios 78
5.2 Set-aside rates for EU crops under the CAP reform
scenario 83
5.3 Selected EU grains and oilseeds under the baseline and
CAP reform scenarios 86
5.4 EU livestock, dairy and poultry meat sectors under the
baseline and CAP reform scenarios 91
5.5 WorId agricultural commodity prices under the CAP
reform scenario 92
5.6 Classification of studies, models and base periods 95
vii
viii List of Tables
5.7 Results for EU cereals production, consumption and net
exports 99
5.8 Results for EU oilseeds production, consumption and
net imports 100
5.9 Results for EU meat production, consumption and net
exports 100
5.10 Results for EU dairy production, consumption and net
exports 102
5.1I Results for world price changes 102
6.1 Transfers in a 2-country, net-exporting union - summary
of effects 1I2
6.2 Commodity support policies - a summary 1I4
6.3 The preferential trade effect 1I6
6.4 The budget effect 1I7
6.5 The total budget and trade effect (BTE) 1I8
6.6 BTE (ECU per capita and percentage of GDP) 1I9
6.7 Key changes under the 1992 reforms 121
6.8 Overall impact of the reforms (1992) 124
6.9 Member state gains and losses 126
7.1 Number of farmers claiming HLCA in Britain asked to
de-stock 152
8.1 Four-firm seller concentration ratios , European food
processing industries 161
8.2 Market shares of leading 2/3 firms in the UK food
processing sector 162
8.3 Market shares in the UK and German food retailing
sectors (1994) 163
8.4 Price transmission and change to consumer surplus with
alternative vertical market structures 172
8.5 Price incidence following EU banana market reforms 173
List of Figures
2.1 AMS for cereals in the EU 28
2.2 FEOGA guarantee expenditure 30
2.3 FEOGA guarantee expenditure on cereals and set-aside 31
6.1 Transfers in a 2-country, net-exporting union 107
6.2 Gains and losses pre-MacSharry reform 125
6.3 Impact of MacSharry 126
7.1 Social value of land by intensity of production 136
7.2 UK agriculture output, current prices 138
7.3 UK agriculture, key input indicators at current prices 139
7.4 Fertiliser inputs in England on an average farm 139
7.5 Arable fertiliser usage in Great Britain 140
7.6 Grassland fertiliser usage in Great Britain 140
7.7 Land prices in England and Wales 143
7.8 Area of set-aside in England, Scotland and Wales 145
7.9 Set-aside in Great Britain in 1992/93 145
7.10 Set-aside in Great Britain, 1993/94 146
7.11 Set-aside in Great Britain, 1994/95 146
7.12 Percentage of eligible ESA land under agreement or
with applications pending 154
8.1 The food chain 160
1X