Farm businesses, described in Chapter 9, exist to bring together factors of production (Chapters 6–8) to generate a supply of agricultural products. Here we examine what determines the level of that supply in the short run, and in the... more
Farm businesses, described in Chapter 9, exist to bring together factors of production (Chapters 6–8) to generate a supply of agricultural products. Here we examine what determines the level of that supply in the short run, and in the next chapter turn to the technical advances which in the longer term contribute to farming’s history of rising output. There is little in this section which will be new to readers familiar with elementary production economics, but for others a presentation of the determinants of supply will be necessary as a complement for the equivalent treatment of demand in Chapter 2.
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The current and prospective direct public expenditures on agricultural support are set against estimates of the costs of alternative ways of providing the outcomes (economic, environmental and social) generated by instruments proposed for... more
The current and prospective direct public expenditures on agricultural support are set against estimates of the costs of alternative ways of providing the outcomes (economic, environmental and social) generated by instruments proposed for the Common Agricultural Policy for the period 2014-20. Central in the discussion are the objectives that the CAP is attempting to achieve and the identification of the net impacts that it has currently. Ways of making estimates of generating the outcomes and their determining factors are considered. A conclusion is that a large potential exists for reducing public spending or of diverting it from the CAP to other policy areas. How this might be achieved in the face of rent-protection, organisational self-interest and national politics are outlined.
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The purpose of this paper is to examine the part that rural development policies can play in assisting the process of adjustment by the farming industry following the reform of agricultural policy. For a mix of historical and... more
The purpose of this paper is to examine the part that rural development policies can play in assisting the process of adjustment by the farming industry following the reform of agricultural policy. For a mix of historical and institutional reasons, rural
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This study investigates the cost of and good practices for FADN data collection in EU Member States during the period 2012-2014 using evidence gathered from existing literature, a survey of EU-28 FADN Liaison Agencies, nine case studies,... more
This study investigates the cost of and good practices for FADN data collection in EU Member States during the period 2012-2014 using evidence gathered from existing literature, a survey of EU-28 FADN Liaison Agencies, nine case studies, and interviews with senior policy officials within the European Commission and the OECD. Costs were assessed both in money terms and by labour input along the data supply chain; total annual public costs of FADN averaged €59 million. A variety of institutional arrangements are used by Member States to provide data to FADN. Within these, three types of organisation carry out the process of data collection: FADN Liaison Agencies; public advisory bodies; and, accounting firms. Data collection by accounting firms from accounts drawn up at the expense of farmers for tax purposes provides data at the lowest public cost per farm. At the other extreme, highest costs per farm are where advisory agencies combine data collection with provision of extension ser...
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Substantial structural change is taking place in EU agriculture. Average farm size is increasing and labour is continuing to move out of the sector. Slow growth in food demand and the effects of technological change on supply are likely... more
Substantial structural change is taking place in EU agriculture. Average farm size is increasing and labour is continuing to move out of the sector. Slow growth in food demand and the effects of technological change on supply are likely to exert downward pressure on real agricultural prices. Within this context, policies at the EU and national levels will have mixed effects on economic adaptation and structural change. There is considerable uncertainty about the long-run viability of the so-called European model of agriculture, particularly given the intensification of pressures for change through economic globalisation.
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Structural policy in the EU is ambiguous in its aims and contains conflicting elements. Interventions to ease change are combined with defensive measures that support income and discourage some aspects of adjustment. Structural change is... more
Structural policy in the EU is ambiguous in its aims and contains conflicting elements. Interventions to ease change are combined with defensive measures that support income and discourage some aspects of adjustment. Structural change is a complex process and the number of farms is an incomplete indicator. Most adjustment takes place without active public assistance. Structural measures at EU level are now mostly within the rural development pillar of the Common Agricultural Policy. Their performance is mixed. However, many countries also have national policies, especially on taxation and land transfer, whose influence on adjustment must not be overlooked.
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The output from agriculture in all industrialised countries seems to be on an inexorable upward trend. While in the EC high prices for farm products, heavily supported by Community aid, are often blamed for overproduction, in real terms... more
The output from agriculture in all industrialised countries seems to be on an inexorable upward trend. While in the EC high prices for farm products, heavily supported by Community aid, are often blamed for overproduction, in real terms prices of many crops and livestock have declined. At first sight this seems at odds with what has been described in the preceding chapter in which supply in the shorter term was seen to be directly related to prices of farm products; we might have expected that lower prices would cut supply. Clearly there must be some other explanation why expansion continues, in the UK at about 2–3 per cent per year. Furthermore, there are suggestions that greater expansion occurs at times when farmers’ profits are under most pressure from depressed market prices or higher costs. Much of the explanation lies in the area of technological advance.
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Earlier chapters in this book have established, first, that agriculture has some special problems, such as income instability because of farming’s reliance on weather and the necessity for adjustments in the structure of farming as an... more
Earlier chapters in this book have established, first, that agriculture has some special problems, such as income instability because of farming’s reliance on weather and the necessity for adjustments in the structure of farming as an expanding output runs up against a static demand for food. Second, it has been shown that governments have become involved with their agricultures, principally through intervention in the markets for farm products and inputs. The first characteristic is often the key to the second. However there are also many instances where government involvement has arisen from historical accident, such as from the urgent necessity to expand domestic food production in times of war, or from a desire to influence other sectors of the economy, such as to maintain a socially viable rural population in remote areas. This attempt to influence the size or shape of the farming industry, for a range of reasons, is broadly labelled ‘agricultural policy’.
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This chapter explains, in the broadest of terms, what the UK agricultural industry is and how it fits into the national economy. The intention is to give an overall picture of the industry so that the more detailed chapters which follow... more
This chapter explains, in the broadest of terms, what the UK agricultural industry is and how it fits into the national economy. The intention is to give an overall picture of the industry so that the more detailed chapters which follow can be set in context. Because UK agriculture is part of the broader agriculture of the European Community, to which a common policy is applied, it is valuable to compare the position of farming in Britain with that found in other member states. Many of the changes happening in British and European agriculture have parallels elsewhere in the world. Indeed, to appreciate the position of agriculture in the UK’s national framework it helps to have an awareness of the process of general economic development, the role which agriculture plays in this process and the changes which occur in the agricultural industry as a country grows and becomes richer. We start, then, with an overview of British agriculture but progress to the European Community level and then the world scale to give the national scene some perspective.
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International cooperation in developing statistics on the income of agricultural households has highlighted the need for agreement on certain aspects of the underlying methodology. These include the choice of accounting framework,... more
International cooperation in developing statistics on the income of agricultural households has highlighted the need for agreement on certain aspects of the underlying methodology. These include the choice of accounting framework, definitions of a household, of an agricultural household and of disposable income. The choice of definition can greatly influence the results and usability within a policy context. International comparability of results requires national data systems to be capable of generating results using these standards as well as servicing national purposes.
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This article argues that a lack of critical reflection on the theoretical foundations of policy interventions and evaluations is common in the discussion about evaluation of Rural Development programs. This shortcoming was also apparent... more
This article argues that a lack of critical reflection on the theoretical foundations of policy interventions and evaluations is common in the discussion about evaluation of Rural Development programs. This shortcoming was also apparent in Special Issue 9(1) of EuroChoices. Intimate knowledge of the underlying causal processes is necessary in order to identify appropriate counterfactuals or reference-scenarios. It is only