Assessing long-term effects of CAP investment support on indicators of farm performance | Zendy

Pia Nilsson | Zendy; Sofia Wixe | Zendy

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Assessing long-term effects of CAP investment support on indicators of farm performance

Author(s) -

Pia Nilsson,

Sofia Wixe

Publication year - 2021

Publication title -

european review of agricultural economics

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 1.4

H-Index - 60

eISSN - 1464-3618

pISSN - 0165-1587

DOI - 10.1093/erae/jbab038

Subject(s) - subsidy , investment (military) , counterfactual thinking , term (time) , economics , matching (statistics) , econometrics , productivity , panel data , selection (genetic algorithm) , selection bias , agriculture , statistics , mathematics , macroeconomics , computer science , ecology , philosophy , physics , epistemology , quantum mechanics , artificial intelligence , politics , biology , political science , law , market economy

In this study of Swedish farms from 2007 to 2016, we estimate the effects of investment support from the Common Agricultural Policy on indicators of farm performance, focusing on long-term effects. To isolate the impact and alleviate problems of selection bias, we employ a counterfactual empirical design using Coarsened Exact Matching and dynamic panel fixed-effects estimations. The average treatment effect on the treated estimates show a positive and significant long-term improvement of farm performance with regard to productivity and turnover. However, the results indicate significant time lags between investments and accumulated observable effects, as we find most short-term effects of the subsidy to be insignificant.

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