This essay deals with the question, whether the Common Agricultural Policy (=CAP) learned from its past experience and its mistakes.
This raises the subquestions if the new system improved in comparison to the old system and if fundamental changes happened. To answer these questions, firstly the CAP will be defined shortly, its historical development and data related to it will be analysed.
Secondly, the economic instruments behind the measures of the CAP will be explained to understand the logic of the development and its consequences. Thirdly, possible solutions are pointed out and a short conclusion sums up the main points and refers again to the main question.
The Common Agricultural Policy, short CAP, is a set of policies with the original main objective of raising farm incomes in the European Union (=EU). Other basic goals have been the creation of a common policy to secure the provision of food at reasonable prices, the stabilization of agricultural markets and to support the efficiency of agriculture.
Nowadays the objectives enlarged to the preservation of natural resources, environment, animal welfare and the support of the rural development. The regulation of the policy, directives and financing through the multiannual financial framework, is set by the EU and today the CAP amounts for nearly 40% of the EU budget.
Table of Contents
- 1 Introduction
- 2 Historical Development
- 3 Economic Instruments
- 4 Possible Solutions
Objectives and Key Themes
This essay aims to evaluate whether the Common Agricultural Policy (CAP) has learned from its past mistakes and improved over time. It analyzes the CAP's historical development, economic mechanisms, and potential solutions to its ongoing challenges.
- Evolution of the CAP and its objectives
- Economic instruments used in the CAP and their consequences
- The impact of the CAP on farm income and market efficiency
- Environmental and social implications of the CAP
- Potential improvements and reforms for the CAP
Chapter Summaries
1 Introduction: This introductory chapter sets the stage by posing the central question of whether the Common Agricultural Policy (CAP) has successfully learned from its past failures. It outlines the sub-questions that will guide the essay's analysis, focusing on comparing the old and new CAP systems and identifying fundamental changes. The chapter briefly introduces the structure of the essay, promising to define the CAP, analyze its historical development, explain its economic underpinnings, and suggest possible solutions before summarizing the main points and addressing the central research question.
2 Historical Development: This chapter provides a detailed historical overview of the CAP, tracing its evolution from its inception in the Treaty of Rome (1957) to its current form. It highlights key milestones, including the initial focus on raising farm incomes and ensuring food security, the "green revolution" and its unintended consequences (environmental degradation, ethical concerns), and the various reforms undertaken to address the policy's shortcomings. The chapter discusses the shift from price support mechanisms to direct payments, the introduction of the two-pillar model, and the increasing emphasis on environmental sustainability and rural development. The chapter also notes the challenges presented by the disproportionate distribution of benefits to large farms and the bureaucratic complexities associated with the CAP.
3 Economic Instruments: This chapter delves into the economic instruments employed by the CAP, primarily focusing on the use of price floors and their impact on various actors. It explains the mechanism of price floors, highlighting how they are used to artificially raise prices above world market levels and their consequences on farmers' income and government revenue. The chapter analyzes the effects of price supports on small and large farms, explaining how the system often disproportionately benefits large farms due to economies of scale. The consequences of the "green revolution," resulting in surplus production ("wheat, beef, and butter mountains") and the necessity for export subsidies and trade conflicts, are discussed. The chapter also addresses the shift from price support to decoupled direct payments as a reform attempt and explores the enduring problem of the "farm income problem" stemming from disproportionate supply and demand shifts.
4 Possible Solutions: This chapter outlines potential solutions to the challenges faced by the CAP. It emphasizes the need for a better integration of ecological and economic concerns, advocating for stronger incentives for environmentally friendly practices. It proposes reforms such as limiting direct payments for large farms while increasing subsidies for small farmers' initial hectares, thereby improving fairness and transparency. Reducing bureaucratic hurdles and ensuring effective monitoring of payments to prevent misuse are also presented as key steps towards a more effective and equitable CAP.
Keywords
Common Agricultural Policy (CAP), farm income, price supports, direct payments, green revolution, environmental sustainability, rural development, market efficiency, economic instruments, reform, European Union (EU), smallholder farmers, large farms, greening measures, cross compliance, decoupling, subsidies.
Frequently Asked Questions: Common Agricultural Policy (CAP) Analysis
What is the purpose of this document?
This document provides a comprehensive preview of an essay analyzing the Common Agricultural Policy (CAP). It includes the table of contents, objectives and key themes, chapter summaries, and keywords.
What are the main objectives and themes explored in the essay?
The essay aims to evaluate if the CAP has improved over time, analyzing its historical development, economic mechanisms, and potential solutions to its ongoing challenges. Key themes include the evolution of the CAP and its objectives, economic instruments and their consequences, the CAP's impact on farm income and market efficiency, its environmental and social implications, and potential improvements and reforms.
What topics are covered in each chapter?
Chapter 1 (Introduction): Introduces the central question of whether the CAP has learned from past failures, outlining the essay's structure and sub-questions. Chapter 2 (Historical Development): Provides a detailed historical overview of the CAP from its inception, highlighting key milestones, reforms, and challenges like the "green revolution" and its consequences. Chapter 3 (Economic Instruments): Delves into the economic instruments used by the CAP, focusing on price floors, their impact on farmers, and the shift from price support to direct payments. It also discusses the "farm income problem." Chapter 4 (Possible Solutions): Outlines potential solutions, emphasizing the integration of ecological and economic concerns, suggesting reforms to improve fairness, transparency, and efficiency.
What are the key economic instruments discussed in the essay?
The essay focuses on price floors, their impact on farmer income and government revenue, and the shift to decoupled direct payments. The consequences of price supports, including surplus production and the need for export subsidies, are also analyzed.
What are the key challenges faced by the CAP according to this document?
The CAP faces challenges such as disproportionate benefits to large farms, bureaucratic complexities, environmental degradation from the "green revolution," the "farm income problem" due to supply and demand imbalances, and the need for greater fairness and transparency in subsidy distribution.
What are some potential solutions proposed for improving the CAP?
Proposed solutions include better integration of ecological and economic concerns, stronger incentives for environmentally friendly practices, limiting direct payments for large farms while increasing subsidies for small farmers' initial hectares, reducing bureaucratic hurdles, and effective monitoring of payments.
What are the keywords associated with this essay?
Common Agricultural Policy (CAP), farm income, price supports, direct payments, green revolution, environmental sustainability, rural development, market efficiency, economic instruments, reform, European Union (EU), smallholder farmers, large farms, greening measures, cross compliance, decoupling, subsidies.
- Citation du texte
- Anonym (Auteur), 2018, The Common Agricultural Policy (CAP): Did the CAP learn from its past experience and its mistakes?, Munich, GRIN Verlag, https://www.grin.com/document/1129928
