We extend the Common Agricultural Policy Regionalised Impact Modelling System (CAPRI) with a regional computational general equilibrium (CGE) model to estimate the effects of the Pillar II of the Common Agricultural Policy. Our aim is to assess the modeling approach by comparing the scenario results with observations from the evaluation reports for rural development, supplemented with expert interviews and findings from the literature. For this purpose, an ex-post scenario is developed for Germany that models the effect of the Pillar II measures in 2006. We observe a moderate impact, namely, an increase in agricultural income (5%) and agricultural land use (0.15%), particularly grassland, and a substitution of arable land with grassland. This effect leads to a total increase in agricultural production, particularly of beef, and to an increase in total greenhouse gas emissions and total nitrogen surplus for Germany. Greenhouse gas emissions and nutrient surpluses per ha, however, are reduced. We observe that farm investment programmes displace private investment. The evaluation reports confirm the moderate impact and our major results, as does the comparison with other literature. However, the conclusions about agri-environment measures and their impact on income differ. The most important difference between our results and the evaluation reports and majority of the present literature is that we also quantify the joint effect between the whole economy and policy measures, with some contradictory effects."> We extend the Common Agricultural Policy Regionalised Impact Modelling System (CAPRI) with a regional computational general equilibrium (CGE) model to estimate the effects of the Pillar II of the Common Agricultural Policy. Our aim is to assess the modeling approach by comparing the scenario results with observations from the evaluation reports for rural development, supplemented with expert interviews and findings from the literature. For this purpose, an ex-post scenario is developed for Germany that models the effect of the Pillar II measures in 2006. We observe a moderate impact, namely, an increase in agricultural income (5%) and agricultural land use (0.15%), particularly grassland, and a substitution of arable land with grassland. This effect leads to a total increase in agricultural production, particularly of beef, and to an increase in total greenhouse gas emissions and total nitrogen surplus for Germany. Greenhouse gas emissions and nutrient surpluses per ha, however, are reduced. We observe that farm investment programmes displace private investment. The evaluation reports confirm the moderate impact and our major results, as does the comparison with other literature. However, the conclusions about agri-environment measures and their impact on income differ. The most important difference between our results and the evaluation reports and majority of the present literature is that we also quantify the joint effect between the whole economy and policy measures, with some contradictory effects."> We extend the Common Agricultural Policy Regionalised Impact Modelling System (CAPRI) with a regional computational general equilibrium (C">
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The Impact of Pillar II Funding: Validation from a Modelling and Evaluation Perspective

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  • Lilli Aline Schroeder
  • Alexander Gocht
  • Wolfgang Britz
Abstract
type="main" xml:id="jage12091-abs-0001"> We extend the Common Agricultural Policy Regionalised Impact Modelling System (CAPRI) with a regional computational general equilibrium (CGE) model to estimate the effects of the Pillar II of the Common Agricultural Policy. Our aim is to assess the modeling approach by comparing the scenario results with observations from the evaluation reports for rural development, supplemented with expert interviews and findings from the literature. For this purpose, an ex-post scenario is developed for Germany that models the effect of the Pillar II measures in 2006. We observe a moderate impact, namely, an increase in agricultural income (5%) and agricultural land use (0.15%), particularly grassland, and a substitution of arable land with grassland. This effect leads to a total increase in agricultural production, particularly of beef, and to an increase in total greenhouse gas emissions and total nitrogen surplus for Germany. Greenhouse gas emissions and nutrient surpluses per ha, however, are reduced. We observe that farm investment programmes displace private investment. The evaluation reports confirm the moderate impact and our major results, as does the comparison with other literature. However, the conclusions about agri-environment measures and their impact on income differ. The most important difference between our results and the evaluation reports and majority of the present literature is that we also quantify the joint effect between the whole economy and policy measures, with some contradictory effects.

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  • Lilli Aline Schroeder & Alexander Gocht & Wolfgang Britz, 2015. "The Impact of Pillar II Funding: Validation from a Modelling and Evaluation Perspective," Journal of Agricultural Economics, Wiley Blackwell, vol. 66(2), pages 415-441, June.
    • Handle: RePEc:bla:jageco:v:66:y:2015:i:2:p:415-441
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    1. Matthews, Alan & Salvatici, Luca & Scoppola, Margherita, 2017. "Trade Impacts of Agricultural Support in the EU," Commissioned Papers 252767, International Agricultural Trade Research Consortium.
    2. Loizou, Efstratios & Karelakis, Christos & Galanopoulos, Konstantinos & Mattas, Konstadinos, 2019. "The role of agriculture as a development tool for a regional economy," Agricultural Systems, Elsevier, vol. 173(C), pages 482-490.
    3. Alan Matthews, 2017. "The development-related impacts of EU agricultural policy," Trinity Economics Papers tep1617, Trinity College Dublin, Department of Economics.
    4. Baur, Ivo & Schläpfer, Felix, 2018. "Expert Estimates of the Share of Agricultural Support that Compensates European Farmers for Providing Public Goods and Services," Ecological Economics, Elsevier, vol. 147(C), pages 264-275.
    5. V. Santoni & M. Pulina, 2016. "An analysis on the Italian agricultural firms: effects of public subsidies," Working Paper CRENoS 201611, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    6. Dudu, Hasan & Smeets Kristkova, Zuzana, 2017. "Impact of CAP Pillar II Payments on Agricultural Productivity," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 261171, European Association of Agricultural Economists.
    7. Hasan Dudu & Emanuele Ferrari, 2018. "Estimation and Modelling Impacts of Pillar 2 Measures on the Agricultural Sector: Workshop proceedings," JRC Research Reports JRC111756, Joint Research Centre.
    8. Javier Castaño & Maria Blanco & Pilar Martinez, 2019. "Reviewing Counterfactual Analyses to Assess Impacts of EU Rural Development Programmes: What Lessons Can Be Learned from the 2007–2013 Ex-Post Evaluations?," Sustainability, MDPI, vol. 11(4), pages 1-22, February.
    9. Huber, Robert & Bakker, Martha & Balmann, Alfons & Berger, Thomas & Bithell, Mike & Brown, Calum & Grêt-Regamey, Adrienne & Xiong, Hang & Le, Quang Bao & Mack, Gabriele & Meyfroidt, Patrick & Millingt, 2018. "Representation of decision-making in European agricultural agent-based models," Agricultural Systems, Elsevier, vol. 167(C), pages 143-160.
    10. Whelan, Adele & McGuinness, Seamus & Barrett, Alan, 2021. "Review of International Approaches to Evaluating Rural and Community Development Investment and Supports," Research Series, Economic and Social Research Institute (ESRI), number RS124.
    11. Morawetz, Ulrich B. & Tribl, Christoph, 2020. "Randomised Controlled Trials for the Evaluation of the CAP: Empirical Evidence about Acceptance by Farmers," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 69(3), July.
    12. Ściubeł, Anna, 2021. "Productivity of Production Factors in Polish Agriculture and in The Selected European Union Countries with Regard to The Common Agricultural Policy Payments," Problems of Agricultural Economics / Zagadnienia Ekonomiki Rolnej 311275, Institute of Agricultural and Food Economics - National Research Institute (IAFE-NRI).
    13. Gohin, Alexandre & Zheng, Yu, 2015. "Assessing the Market Impacts of the Common Agricultural Policy: Does Farmers’ Risk Attitude Matter?," 2015: Trade and Societal Well-Being, December 13-15, 2015, Clearwater Beach, Florida 229235, International Agricultural Trade Research Consortium.
    14. Alexandre Gohin & Yu Zheng, 2016. "Assessing the Market Impacts of the Common Agricultural Policy: Does Farmers' Risk Attitude Matter?," FOODSECURE Working papers 46, LEI Wageningen UR.
    15. Ewa Kiryluk-Dryjska & Agnieszka Baer-Nawrocka & Obinna Okereke, 2022. "The Environmental and Climatic CAP Measures in Poland vs. Farmers’ Expectations—Regional Analysis," Energies, MDPI, vol. 15(13), pages 1-13, June.
    16. Britz, Wolfgang & Ciaian, Pavel & Gocht, Alexander & Kanellopoulos, Argyris & Kremmydas, Dimitrios & Müller, Marc & Petsakos, Athanasios & Reidsma, Pytrik, 2021. "A design for a generic and modular bio-economic farm model," Agricultural Systems, Elsevier, vol. 191(C).
    17. Kiryluk-Dryjska, Ewa & Baer-Nawrocka, Agnieszka, 2019. "Reforms of the Common Agricultural Policy of the EU: Expected results and their social acceptance," Journal of Policy Modeling, Elsevier, vol. 41(4), pages 607-622.

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