Farm-level response to agricultural development strategies in the Evora dryland region of Portugal
Abstract
A bio-economic model was constructed to capture the interactions between crop and livestock technologies and the riskiness of farming in the Evora dryland region. The objective was to assess traditional and new crop and livestock technologies under alternative policy scenarios in agricultural factor and commodity markets. The consistency of this empirical model and its ability to predict observed changes was tested by the introduction of alternative crop yields and price scenarios. Model results were consistent with the crop and livestock production patterns in Alentejo agriculture in the last two decades. Alternative credit and land policies as well as the effects of Portugal's transition to full EEC policies on traditional and potential new crop and livestock technologies in the Evora dryland farming region were examined. The assessment of these alternative scenarios showed the easier access to credit for financing cash flow needs of traditional crop and livestock enterprises did not affect the optimal farm production decisions. Portuguese product price alignment with CAP prices will reduce farm profitability of traditional technologies drastically over the transition period of Portugal's accession to the EEC. The introduction of new crop and livestock technologies such as triticale, forages, improved pastures and improved livestock systems increases farm profitability of the Evora farms substantially. The study of alternative agricultural factor policies showed that easier access to credit facilitates the introduction of new technologies. With the introduction of ley rotations and improved livestock management systems, most of the income decline from the downward adjustment to the CAP policies over the next decade can be eliminated. Ley rotations include cereals and improved pastures with subterranean clover. Improved livestock systems are characterized by two breeding periods over the year. These results strongly encourage the development of research and extension programs to extend new technologies in the Alentejo.
Degree
Ph.D.
Advisors
Sanders, Purdue University.
Subject Area
Agricultural economics
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