26 Jul 2012

Income Distributional Effects of Decoupled Payments: Single Payment Scheme in the European Union

Pavel Ciaian / d’Artis Kancs

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This paper analyses the effects of the Single Payment Scheme (SPS) with and without farm structural change, and focuses on how income distributional effects and farm restructuring are impacted by the SPS under: alternative entitlement tradability, cross-compliance and CAP 'greening' requirements, different SPS implementation models, the entitlement stock, market imperfections and institutional regulations.

The authors find that the SPS implication details are highly significant, since farmers’ benefits can range from 100% of the SPS value to a negative policy incidence, and farm structural change may also be hindered by the SPS.

These Working Papers present work being conducted within the FACTOR MARKETS research project, see: www.factormarkets.eu