Farm Level Adjustment in Ireland Following Decoupling

The paper is a case study of how the Luxembourg Agreement of the Mid-Term Review of the Common Agricultural Policy may affect the structure of dairy and beef farming in the Republic of Ireland over the period 2002 to 2012. It describes the process used to assess some structural implications of a policy change. The data source for the paper is the Irish National Farm Survey. Prices of inputs and outputs following the policy change are obtained from a dynamic partial equilibrium model of the agricultural sector. Linear Programming is used to calculate the maximum profit on different farm types. Labour allocation on farms is estimated using a logit function. Exit from dairy production is also estimated. Some example results on dairy and beef farms are presented.