EU Land Markets and the Common Agricultural Policy

More documents

Recommendations

Info

x | EXECUTIVE SUMMARYsignificance of the SPS compared with other drivers of land values. Theempirical evidence from this study implies that the relative weight of theSPS in determining farmland prices against that of other drivers of landvalues is higher for rents than for sales prices.Preliminary evidence reveals that the historical model leads to lowercapitalisation of the SPS into land values than the regional or hybrid models. Incountries with the hybrid model, capitalisation appears to be driven by thelow amount of naked land. In countries with the historical model, theimpact of the SPS appears to be substantially weaker. Where SPS landcapitalisation occurs, the most influential factor tends to be structuralchange combined with constrained entitlement trading (most notably inBelgium). In countries such as Greece, there is little activity on the landmarket and hence there is little capitalisation of the SPS. In Ireland, thepossibility to consolidate entitlements has reduced the pressure of the SPSon land markets and SPS land capitalisation appears to be minimal.We also find that instead of reducing capitalisation, introduction of the SPSappears to have increased capitalisation in the least productive countries. The SPSseems to have put a floor on land values in less productive regions (e.g. inSweden and parts of the UK). The clearest evidence of the influence of theSPS on land values is higher land values for less fertile land (e.g.grassland). But this finding could also be rooted in the redistribution thatcame with the hybrid model.In countries with regulated rental prices, implementation of the SPS seemsmainly to affect unofficial markets. In these member states, there is little effecton official prices (since these are regulated), but where regulations lead tothe existence of unofficial markets for agricultural land, the SPS tends toincrease both rental prices (e.g. Belgium) and volumes on the unofficialmarket (e.g. Belgium and the Netherlands).Distribution of SPS benefitsLandowners tend to benefit more from the hybrid model than from the historicalmodel. More specifically, landowners benefit more under the hybrid modelthrough two channels. The first is the capitalisation of the SPS into landvalues. This is mostly the case where low amounts of naked land drive upland values. The second channel concerns the implementation features ofthe hybrid model. Under the hybrid model, the number of entitlements thatfarmers receive is equal to the total eligible area in the first year of the SPSapplication. This has enabled some non-farming landowners to obtain
EU LAND MARKETS AND THE COMMON AGRICULTURAL POLICY | xientitlements either by cancelling the existing rental contracts and applyingfor entitlements themselves or by adjusting rental contracts to ensure thatentitlements return to them after the contract expires, or by undertakingother similar arrangements.The distribution of the SPS payments to landowners appears to differmarkedly among the EUSCs. From our country studies, it seems thatlandowners benefit most from the SPS in Finland and Sweden (60-100% ofthe value of the entitlement) and least in Greece and Ireland (0-10%). In therest of the countries, the benefits that accrue to landowners from the SPSare in the low to medium range (10-60%).The distribution of the SPS additionally depends on whether landowners arealso farmers, which varies among the EUSCs. As mentioned above, theprevalence of renting land differs greatly among the EUSCs. The evidencein this study suggests that in Germany, Northern Ireland and Sweden, asubstantial share of SPS benefits will be channelled to non-farminglandowners. This finding also holds (but to a lesser extent) for England,Finland and Scotland. In the rest of the EUSCs, a lower share of the SPS willgo to non-farming landowners, either because renting land is less commonor because there is little capitalisation of the SPS into land values (or both).In these countries, farmers appear to gain the largest proportion of the SPS.Effects on structural changeIt is too early to observe significant effects of the SPS on structural change inagriculture. Structural change is a long-term process, and it is thereforepremature to assess the developments observed one or two years since theSPS was introduced. Meanwhile, substantial structural changes related tofactors other than the SPS have occurred in agriculture in the last few years.Still, the decoupling of subsidies with the introduction of the SPS has beenidentified by most country studies as having had a major impact onstructural change in agriculture.The SPS seems to constrain farm exit and increase part-time farming.Evidence from several countries, e.g. Belgium, Finland, Sweden and theUK, suggests that the SPS constrains farm exit. The SPS also appears toincrease part-time farming – an effect that seems more pronounced inmarginal areas. Part-time farming allows farmers to reduce unprofitablefarm activities while still benefiting from the SPS. No significant differencecan be identified between the hybrid and historical models in this respect.
Page 1 and 2: EU LAND MARKETSAND THECOMMON AGRICU
Page 3 and 4: CONTENTSAcknowledgements...........
Page 5 and 6: Empirical studies on land rents....
Page 7 and 8: Figure 34. Regional differences in
Page 9: Figure 80. Effect of the regional S
Page 12 and 13: LIST OF ABBREVIATIONSACs Autonomous
Page 14 and 15: iv | EXECUTIVE SUMMARYasset values
Page 16 and 17: vi | EXECUTIVE SUMMARYbut their eff
Page 18 and 19: viii | EXECUTIVE SUMMARYtends to be
Page 22 and 23: xii | EXECUTIVE SUMMARYThe impact o
Page 25 and 26: 1. INTRODUCTIONThe establishment of
Page 27 and 28: 2. CONCEPTUAL FRAMEWORKSince the fo
Page 29 and 30: EU LAND MARKETS AND THE COMMON AGRI
Page 71 and 72:
EU LAND MARKETS AND THE COMMON AGRI
Page 73 and 74:
Page 75 and 76:
Page 77 and 78:
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87 and 88:
Page 89 and 90:
Page 91 and 92:
Page 93 and 94:
Page 95 and 96:
Page 97 and 98:
Page 99 and 100:
Page 101 and 102:
Page 103 and 104:
Page 105 and 106:
Page 107 and 108:
Page 109 and 110:
Page 111 and 112:
Page 113 and 114:
Page 115 and 116:
Page 117 and 118:
Page 119 and 120:
Page 121 and 122:
Page 123 and 124:
Page 125 and 126:
Page 127 and 128:
Page 129 and 130:
Page 131 and 132:
Page 133 and 134:
Page 135 and 136:
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Page 145 and 146:
Page 147 and 148:
Page 149 and 150:
Page 151 and 152:
Page 153 and 154:
Page 155 and 156:
Page 157 and 158:
Page 159 and 160:
Page 161 and 162:
8. IMPACT OF THE SPS ON LANDMARKETS
Page 163 and 164:
Page 165 and 166:
Page 167 and 168:
Page 169 and 170:
Page 171 and 172:
Page 173 and 174:
Page 175 and 176:
Page 177 and 178:
Page 179 and 180:
Page 181 and 182:
Page 183 and 184:
Page 185 and 186:
Page 187 and 188:
Page 189 and 190:
Page 191 and 192:
Page 193 and 194:
Page 195 and 196:
Page 197 and 198:
Page 199 and 200:
Page 201 and 202:
Page 203 and 204:
Page 205 and 206:
Page 207 and 208:
Page 209 and 210:
Page 211 and 212:
Page 213 and 214:
Page 215 and 216:
Page 217 and 218:
BIBLIOGRAPHYAbler, D. (2001), “El
Page 219 and 220:
Page 221 and 222:
Page 223 and 224:
Page 225 and 226:
Page 227 and 228:
Page 229 and 230:
Page 231 and 232:
Page 233 and 234:
Page 235 and 236:
Page 237 and 238:
Page 239 and 240:
Page 241 and 242:
Page 243 and 244:
Page 245 and 246:
Page 247 and 248:
Page 249 and 250:
Page 251 and 252:
Page 253 and 254:
Page 255 and 256:
Page 257 and 258:
Page 259 and 260:
Page 261 and 262:
Page 263 and 264:
Page 265 and 266:
Page 267 and 268:
Page 269 and 270:
Page 271 and 272:
Page 273 and 274:
Page 275 and 276:
Page 277 and 278:
Page 279 and 280:
Page 281 and 282:
Page 283 and 284:
Page 285 and 286:
Page 287 and 288:
Page 289 and 290:
Page 291 and 292:
Page 293 and 294:
Page 295 and 296:
Page 297 and 298:
Page 299 and 300:
Page 301 and 302:
Page 303 and 304:
Page 305 and 306:
Page 307 and 308:
APPENDIX 1. LITERATURE REVIEWIntrod
Page 309 and 310:
Page 311 and 312:
Page 313 and 314:
Page 315 and 316:
Page 317 and 318:
Page 319 and 320:
Page 321 and 322:
Page 323 and 324:
Page 325 and 326:
Page 327 and 328:
Page 329 and 330:
Page 331 and 332:
Page 333 and 334:
Page 335 and 336:
Page 337 and 338:
Page 339 and 340:
Page 341 and 342:
Page 343 and 344:
Page 345 and 346:
Page 347 and 348:
Page 349 and 350:
Page 351 and 352:
Page 353 and 354:
Page 355 and 356:
Page 357 and 358:
Page 359 and 360:
Page 361 and 362:
Page 363 and 364:
Page 365 and 366:
Page 367:
show all

EU Land Markets and the Common Agricultural Policy

Create successful ePaper yourself

Delete template?

Save as template?