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    2. Farm technical and environmental efficiency and subsidy redistribution in Ireland: A simulation approach of possible performance and equity effects

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    Collection:
    Agricultural Communications Documentation Center (ACDC)
    Contributers:
    Cillero,Maria Martinez (author) and Reaños, Miguel Tovar (author)
    Format:
    Journal article
    Publication Date:
    2022-09-12
    Published:
    USA: John Wiley & Sons Ltd
    Location:
    Agricultural Communications Documentation Center, Funk Library, University of Illinois Box: 205 Document Number: D12636
    Journal Title:
    Agriculture Economics
    Journal Title Details:
    Online
    Notes:
    19 pages, We investigate the relationship between EU Common Agricultural Policy environmental payments, and dairy and beef farm level competitiveness and environmental performance. We use an Irish panel of farm level financial data for the years 2000–2017 and apply stochastic frontier analysis. Our estimates identify a positive relationship between technical efficiency and the Green, Low-Carbon, Agri-Environment Scheme for dairy farms, in contrast with the negative relation identified for previous payments of this kind such as the Rural Environment Protection Scheme for both beef and dairy. We then simulate increases in the first type of environmental payments financed through reductions in decoupled payments. We use alternative scenarios for payment redistribution such as flat allocation, allocation to farms with low stocking rates or proportional reallocation of payments. We find that under the second scenario, marginal environmental gains can potentially be achieved for dairy farms. For beef farms, the proportional allocation performs best regarding environmental gains. We also find that under this scenario, the impacts on income inequality can be smoothed for both farm types.