Rent-seeking in agricultural policy revisited: a new look at the Common Agricultural Policy consensus

Bazyli Czyżewski , Anna Matuszczak

Abstract

It is generally believed that agricultural interventionism represents the payment of political rents to farmers. We attempt to show that the concept of political rent known as the rent-seeking theory is not valid for agricultural policy. It is not justified to identify the entire subsidies paid to agriculture as a ‘political rent’, since political rents cannot be taken to include payments for the supply of public goods or those transfers which compensate for market imperfections. Our work aims firstly to review the concepts of rents and rent-seeking, and to develop a methodology for quantifying political rents in agricultural policy. We perform comparative analyses with the aim of calculating the ‘pure political rent’, based on the input-output approach for representative farms according to the EU FADN typology and on a decomposition of the Hicks–Moorsteen TFP index for the period 2004-2012 and 27 European Union Member States. The calculations of political rents show that historical payments are neither a rational nor a just solution. No attempts have yet been made in the literature to quantify political rents, even though this might lead to an improvement in the effectiveness of public expenditure. The original methodology is proposed for valuing these items.
Author Bazyli Czyżewski (WE / KEiRK)
Bazyli Czyżewski,,
- Department of Education and Personnel Development
, Anna Matuszczak (WE / KMiGŻ)
Anna Matuszczak,,
- Department of Macroeconomics and Agricultural Economics
Journal seriesStudies in Agricultural Economics, ISSN 1418-2106, (B 4 pkt)
Issue year2018
Vol120
No1
Pages1-11
Publication size in sheets0.5
Keywords in Englishpolitical rent, rent-seeking, agriculture, treadmill theory
DOIDOI:10.22004/ag.econ.276085
URL https://ageconsearch.umn.edu/record/276085
Languageen angielski
Score (nominal)4
Score sourcejournalList
ScoreMinisterial score = 4.0, 20-04-2020, ArticleFromJournal
Publication indicators WoS Citations = 0
Citation count*1 (2020-09-12)
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