The post-Lisbon role of the European Parliament in the EU's Common Commercial Policy: Implications for bilateral trade negotiations. EU Diplomacy Paper 05/2012, July 2012

This paper sets out to conduct an empirical analysis of the post-Lisbon role of the European Parliament (EP) in the EU’s Common Commercial Policy through an examination of the ‘deep and comprehensive’ bilateral Free Trade Agreements (FTAs) currently negotiated as part of the EU’s Global Europe strategy. The EU-Korea and EU-India FTAs are used as case studies in order to determine the implications of the EP’s enhanced trade powers on the processes, actors and outcomes of EU bilateral trade policy. The EP is now endowed with the ‘hard power’ of consent in the ratification phase of FTAs, acting as a threat to strengthen its ‘soft power’ to influence negotiations. The EP is developing strategies to influence the mandate and now plays an important role in the implementation of FTAs. The entry of this new player on the Brussels trade policy field has brought about a shift in the institutional balance of power and opened up the EP as a new point of access for trade policy lobbyists. Finally, increased EP involvement in EU trade policy has brought about a politicisation of EU trade policy and greater normative outcomes of FTAs.

The visibility of agricultural subsidies and market illusions in the Common Agricultural Policy: Some evidence from farmers' views in Germany, Portugal and the United Kingdom

This article demonstrates that the design and nature of agricultural support schemes has an influence on farmers' perception of their level of dependence on agricultural support. While direct aid payments inform farmers about the extent to which they are subsidised, indirect support mechanisms veil the level of subsidisation, and therefore they are not fully aware of the extent to which they are supported. To test this hypothesis, we applied data from a survey of 4,500 farmers in three countries: the United Kingdom, Germany and Portugal. It is demonstrated that indirect support, such as that provided through artificially high consumer prices, gives an illusion of free and competitive markets among farmers. This 'visibility' hypothesis is evaluated against an alternative hypothesis that assumes farmers have complete, or at least a fairly comprehensive level of, information on agricultural support schemes. Our findings show that this alternative hypothesis can be ruled out.

Assessing the impact of the 'Decoupling' reform of the common agricultural policy on Irish farmers' off-farm labour market participation decisions

This paper assesses the impact of the 'decoupling' reform of the Common Agricultural Policy on the labour allocation decisions of Irish farmers. The agricultural household decision-making model provides the conceptual and theoretical framework to examine the interaction between government subsidies and farmers' time allocation decisions. The relationship postulated is that 'decoupling' of agricultural support from production would probably result in a decline in the return to farm labour but it would also lead to an increase in household wealth. The effect of these factors on how farmers allocate their time is tested empirically using labour participation and labour supply models. The models developed are sufficiently general for application elsewhere. The main findings for the Irish situation are that the decoupling of direct payments is likely to increase the probability of farmers participating in the off-farm employment market and that the amount of time allocated to off-farm work will increase.

Explaining the 'health check' of the Common Agricultural Policy: budgetary politics, globalisation and paradigm change revisited

Three potential explanations of past reforms of the Common Agricultural Policy (CAP) can be identified in the literature: a budget constraint, pressure from General Agreement on Tariffs and Trade/World Trade Organization (GATT/WTO) negotiations or commitments and a paradigm shift emphasising agriculture’s provision of public goods. This discussion on the driving forces of CAP reform links to broader theoretical questions on the role of budgetary politics, globalisation of public policy and paradigm shift in explaining policy change. In this article, the Health Check reforms of 2007/2008 are assessed. They were probably more ambitious than first supposed, although it was a watered-down package agreed by ministers in November 2008. We conclude that the Health Check was not primarily driven by budget concerns or by the supposed switch from the state-assisted to the multifunctional policy paradigm. The European Commission’s wish to adopt an offensive negotiating stance in the closing phases of the Doha Round was a more likely explanatory factor. The shape and purpose of the CAP post-2013 is contested with divergent views among the Member States.

Predicting the impact of the EU common agricultural policy reform in England: micro and macroeconomic aspects

In this article we investigate the effects of the European CAP reform on a selection of arable crops in England, both at a regional and national level. The results show that the CAP reform will push farmers to adjust to the new market conditions, which will cause a further restructuring of the English agricultural business sector. Our results show that, under the new market conditions, economically-small farms will increase their output by allocating more land to cereals, whereas economically-large farms will need to decrease land allocated to cereals to reduce production costs and achieve better returns.

The implications of the 2003 Common Agricultural Policy reforms for land use and landscape quality in England

The assessment of the potential landscape impacts of the latest Common Agricultural Policy reforms constitutes a challenge for policy makers and it requires the development of models that can reliably project the likely spatial distribution of land uses. The aim of this study is to investigate the impact of 2003 CAP reforms to land uses and rural landscapes across England. For this purpose we modified an existing economic model of agriculture, the Land-Use Allocation Model (LUAM) to provide outputs at a scale appropriate for informing a semi-quantitative landscape assessment at the level of ‘Joint Character Areas’ (JCAs). Overall a decline in the cereal and oilseed production area is projected but intensive arable production will persist in specific locations (East of England, East Midlands and South East), having ongoing negative effects on the character of many JCAs. The impacts of de-coupling will be far more profound on the livestock sector; extensification of production will occur in traditional mixed farming regions (e.g. the South West), a partial displacement of cattle by sheep in the upland regions and an increase in the sheep numbers is expected in the lowlands (South East, Eastern and East Midlands). This extensification process will affect positively those JCAs of mixed farming conditions, but it will have negative impacts on the JCAs of historically low intensity farming (e.g. the uplands of north-west) because they will suffer from under-management and land idling. Our analysis shows that the territorialisation between intensively and extensively agricultural landscapes will continue.

Another reform? proposals for the post-2013 Common Agricultural Policy

Following two decades of policy change, in 2011 the European Commission tabled proposals for a new ‘reform’ of the CAP. A major component of the reform would be a revamping of the existing system of direct payments to farmers. For example, 30% of the spend would be dependent on farmers respecting new greening criteria; and payments would be restricted to active farmers and subject to a payment cap. These proposals will be debated by the Council of Ministers and the European Parliament throughout 2012, and possibly 2013, before final decisions are reached. What aspects, if any, of the proposals will prove acceptable is yet to be discerned. Although tabled as part of a financial package, the proposals do not appear to be driven by financial exigency: indeed they seek to maintain the expenditure status quo. Nor do they appear to be driven by international pressures: if anything, they backtrack on previous attempts to bring the CAP into conformity with a post-Doha WTO Agreement on Agriculture. Instead they seek to establish a new partnership between society and ‘farmers, who keep rural areas alive, who are in contact with the ecosystems and who produce the food we eat’ (Cioloș 2011), in an attempt to justify continuing support.