Article ID: | iaor20084461 |
Country: | United Kingdom |
Volume: | 34 |
Issue: | 1 |
Start Page Number: | 21 |
End Page Number: | 52 |
Publication Date: | Mar 2007 |
Journal: | European Review of Agricultural Economics |
Authors: | Huylenbroeck Guido Van, Buysse Jeroen, Fernagut Bruno, Harmignie Olivier, Frahan Bruno Henry de, Lauwers Ludwig, Polom Philippe, Meensel Jef Van |
Keywords: | programming: mathematical |
A mathematical programming model, calibrated on individual farm data, is used to analyse the reform of the common market organisation (CMO) in the sugar sector of the European Union. The model includes a precautionary farm supply function for out-of-quota sugar beet that is estimated as part of a simultaneous system of first-order conditions. Simulation results from a sample of Belgian sugar beet farms show that the sugar CMO reform induces different supply and income effects across farms depending on their share of out-of-quota sugar beet relative to their total beet supply and their quota rent. A further cut in the minimum price of sugar beet initiates structural change in the farm sector.