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Impacts of the European Biofuel Policy on the Farm Sector: A General Equilibrium Assessment
Author(s) -
Gohin Alexandre
Publication year - 2008
Publication title -
applied economic perspectives and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.4
H-Index - 49
eISSN - 2040-5804
pISSN - 2040-5790
DOI - 10.1111/j.1467-9353.2008.00437.x
Subject(s) - biofuel , economics , general equilibrium theory , agricultural economics , partial equilibrium , natural resource economics , international trade , international economics , macroeconomics , microbiology and biotechnology , biology
We assess the impacts of the European indicative biofuel policy on the farm sector with a farm‐detailed computable general equilibrium model. Our simulations suggest that most of the biodiesel demand will be satisfied by imports while the bioethanol demand will be satisfied mostly by domestic production. We also show that the downstream livestock sectors are never negatively affected. Finally, the positive farm income effect is rather robust to our modeling assumptions: our central estimate is a 3.2 billion farm‐income increase. However, the transfer efficiency of this policy is invariably limited.