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An Analysis of the Impact of Alternative EU Dairy Policies on the Size Distribution of Dutch Dairy Farms: an Information Based Approach to the Non-Stationary Markov Chain Model

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  • Jongeneel, Roelof A.

Abstract

This paper analyses the impact of the dairy quota scheme on the size distribution of the Dutch dairy industry. A non-stationary Markov model approach is use, where the transition probabilities are explained by a set of exogenous (policy) variables. Using an information theoretical approach, a model is estimated for The Netherlands and used to simulate the impacts of alternative EU dairy policies. Several results emerged: a) There is an autonomous over time decline in farm numbers (implying increase in farm size). b) The dairy quota regime positively influences 'small' and 'medium' farm sizes; c) Abolition of the dairy quota will negatively affect the total number of active farms and favours further increase of farm scale. d) Targeting support according to needs increases the number of active dairy farms as compared with the status quo.

Suggested Citation

  • Jongeneel, Roelof A., 2002. "An Analysis of the Impact of Alternative EU Dairy Policies on the Size Distribution of Dutch Dairy Farms: an Information Based Approach to the Non-Stationary Markov Chain Model," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24892, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae02:24892
    DOI: 10.22004/ag.econ.24892
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    References listed on IDEAS

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    Cited by:

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    2. Xavier, Antonio & Martins, Maria de Belem Costa Freitas & Fragoso, Rui Manuel de Sousa, 2011. "Recovery of Incomplete Data of Statistical Livestock Number Applying an Entropy Approach," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 115790, European Association of Agricultural Economists.
    3. Alexander Gocht & Norbert Röder & Sebastian Neuenfeldt & Hugo Storm & Thomas Heckelei, 2012. "Modelling farm structural change: A feasibility study for ex-post modelling utilizing FADN and FSS data in Germany and developing an ex-ante forecast module for the CAPRI farm type layer baseline," JRC Research Reports JRC75524, Joint Research Centre.
    4. Thia Hennessy & Tahir Rehman, 2006. "Modelling the Impact of Decoupling on Structural Change in the Farming Sector: integrating econometric and optimisation models," Working Papers 0601, Rural Economy and Development Programme,Teagasc.
    5. Piet, Laurent, 2008. "The evolution of farm size distribution: revisiting the Markov chain model," 2008 International Congress, August 26-29, 2008, Ghent, Belgium 44269, European Association of Agricultural Economists.

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