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Economic and household impacts of policy interventions in the Irish agri-food sector until 2020

Ole Boysen, Ana Corina Miller and Alan Matthews

IIIS Discussion Paper No. 445

Over the period 2005-2020, the Irish agri-food sector is confronted with three major policy changes: the decoupling of the single farm payment, the elimination of the dairy quota and potential multilateral trade liberalisation as part of an agreement in the Doha Development Round. This paper studies these reforms and their impacts on the economy and income distribution using a CGE model particularly rich in detail on agri-food sectors, differentiated household groups, and agricultural policy instruments including their links to productive factors and households. This allows customising the model to appropriately represent the specific policy instruments and their actual or potential changes. The results suggest that the past and projected changes in the policy environment have, in sum, a small positive impact on GDP and household income. But, the gains and losses are unequally distributed across sector and household groups due to the highly differentiated distribution of support and protection. While all households generally gain from the sequence of policy reforms in the long run, some experience strong adverse effects from particular reforms and in the medium run.

Keywords: Single Farm Payment; Doha Round; milk quota; Ireland; income distribution;
computable general equilibrium

JEL classification: D58; F13; O52; Q18

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Last updated 28 August 2014 by IIIS (Email).