impact of the additional premium ceiling on the targeting of beneficiary farms

2023-05-04 00:00:00

Plan

Simulation of the implementation of the redistributive payment

1. Adaptation of the simulator to the use of public microdata from Rica

2. Calculation of the redistributive payment for different additional premium ceilings

3. Calculation of the PR for the farms observed in Rica and reference scenario

Analysis of the impact of the additional premium ceiling

Conclusion

The reform of the Common Agricultural Policy (CAP) of 2013 introduced the redistributive payment (PR), or “surprime for the first hectares”, with the aim of redistributing part of the direct aid from the first pillar towards the smallest farms. This article assesses the redistributive effects of this payment and discusses the impact of the upper premium ceiling chosen (52 ha). We show that to target redistribution on farms actually smaller than 52 hectares, a much lower ceiling would have to be chosen.

The 2013 CAP reform in fact highlighted the desire to change the payments allocated under its first pillar (direct aid to farmers) in order, on the one hand, to reconnect the allocation of agricultural aid with new environmental and social issues in agriculture and, on the other hand, modify the distribution of income support towards greater equity by favoring farms that have hitherto been the least profitable…

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