Environmental and economic effects of a fall in cereal prices in the EU internal market: The case of Denmark

TY - JOUR

T1 - Environmental and economic effects of a fall in cereal prices in the EU internal market

T2 - The case of Denmark

AU - Wier, Mette

AU - Hasler, Berit

AU - Andersen, Johnny M.

AU - Jensen, Jørgen D.

PY - 2001/9

Y1 - 2001/9

N2 - Reform of the European Common Agricultural Policy (the CAP) will reduce cereal prices in the Internal Market while simultaneously increasing direct support to farmers (Agenda 2000). This paper examines the possible effects of liberalisation of the CAP by modelling the effects of a 10 per cent reduction in cereal prices combined with compensation to farmers. We applied an integrated modelling system suitable for estimating both the economic and environmental consequences of agricultural and environmental policy measures and calculated the effects of a 10 per cent fall in cereal prices on nitrogen loading of the Danish marine waters, on private consumption, GDP, the balance of payments, and employment. The results indicate that price reductions do not have significant effects on nitrogen loading relative to the 50 per cent reduction target, since a 10 per cent reduction in cereal prices only leads to a 2.4 per cent reduction in loading.

AB - Reform of the European Common Agricultural Policy (the CAP) will reduce cereal prices in the Internal Market while simultaneously increasing direct support to farmers (Agenda 2000). This paper examines the possible effects of liberalisation of the CAP by modelling the effects of a 10 per cent reduction in cereal prices combined with compensation to farmers. We applied an integrated modelling system suitable for estimating both the economic and environmental consequences of agricultural and environmental policy measures and calculated the effects of a 10 per cent fall in cereal prices on nitrogen loading of the Danish marine waters, on private consumption, GDP, the balance of payments, and employment. The results indicate that price reductions do not have significant effects on nitrogen loading relative to the 50 per cent reduction target, since a 10 per cent reduction in cereal prices only leads to a 2.4 per cent reduction in loading.

KW - Agricultural policy

KW - Environmental economics

KW - Environmental effects

KW - Integrated modelling

KW - Nitrogen loading

U2 - 10.1023/A:1017922417931

DO - 10.1023/A:1017922417931

M3 - Journal article

AN - SCOPUS:0034784615

SN - 0924-6460

VL - 20

SP - 73

EP - 90

JO - Environmental and Resource Economics

JF - Environmental and Resource Economics

IS - 1

ER -