Die Bodenkultur - Journal for Land Management, Food and Environment

K. M. Ortner:

Estimation of Impacts and acceptability of policies to reform the EU dairy marketl

Summary

In order to estimate the impact of Agenda 2000 and alternative proposals for changes in the market organization for milk and dairy products in the EU, a world dairy model was developed and econometrically estimated on the basis of the data and forecasts until 2001 of OECD's AGLINK model. The model is capable of simulating dynamically the responses of participants in these markets and their effects on market equilibrium. Four scenarios (and two subscenarios) with progressive policy changes in terms of quota levels, intervention prices and export subsidies from 1997 through 2001 were analysed and compared to a base run in which producer prices were held constant, A reduction of intervention prices by 15 %and an increase in quotas by 2 % leads producer prices to decline by 10 % below the base line estimate. This result was preferred in terms of a political preference function over szenarios featuring a reduction of export subsidies. Key words: Agricultural policy, EU, dairy market, price analyis, policy simulation, welfare.