Commission of the UE Genedec project (FP6-502184) Rural Development Policy: Possible Impact on Agricultural Productivity in Old and New Member States Commission of the UE Genedec project (FP6-502184) Elisa Montresor Univeristy of Verona – Italy Francesco Pecci University of Verona - Italy Maria Sassi University of Pavia - Italy

Importance of the analysis Fostering and enabling policy and institutional environment Encouraging agricultural productivity and competitiveness Rural Development Policy (2007-13) Strategic priorities Encouraging non-farm growth activity Improving social well-being, gender equity, managing risk, reducing vulnerability The rural development policy for the programming period 2007-2013 has stated five strategic priorities: Encouraging sustainable management of natural resources

Importance of the analysis Relationship between local agricultural systems and local socio-economic systems The analysis of the territorial systems Impact of policy sensitive socio-economic and environmental variables on agriculture productivity Policy making process Within this framework the agricultural sector is called to strongly interact with local socio-economic and environmental factor for rural development and its competitiveness (one of the main objective of the CAP reform) is going to be affected by the policy action on the policy sensitive socio-economic and environmental variable. In this context today there is the need for territorial analysis aimed at understanding the relationship between the local agricultural systems and the local socio-economic systems and in the light of this relationship it is relevant the understanding of the impact of …. A key analysis for the policy making process required to both the old and new Member States by the new rural development policy and the modulation and cross-compliance introduced by the CAP reform. Importance for the old and new Member States The Rural Development Policy, Modulation and Cross-compliance

The CAP regionalization? Impact of policy sensitive socio-economic environmental variables on agriculture productivity Agricultural territorial systems within homogeneous socio-economic systems 1. Importance of the analysis 2. Object of the analysis The CAP regionalization? Object of the analysis Spatial stationary and non-stationary parameters Insights for territorial and decentralised intervention policymaking Groups of homogeneous regions

Data processing chain 4. Adjustment 5. Initial data 1. Initial data 1. Importance of the analysis 4. Adjustment and integration 5. Initial data set 2. Object of the analysis 1. Initial data set 3. Data processing chain 6. AIC + multicollinearity 7. Indicators for mixed GWRs 2. PCA 3. Local agricultural and socio-economic systems 8a. Spatial Stationary parameters 8b. Spatial Non-stationary parameters 10. Regionalization results 9.Kohonen SOM classification

Indicators: analytical framework 1. Importance of the analysis Common 2. Object of the analysis Environmental, food safety and animal welfare standards Cross-compliance and good practices 3. Data processing chain - Competitiveness - Environment and Country side - Quality of life and Diversification of Rural areas 4. Indicators: analytical framework - Competitiveness - Multifunctionality - Sustainability Farmers: free to produce what the market needs Rural development Consumers Taxpayers Decoupling Single farm payments Modulation Agricultural Policy

Agricultural productivity Indicators 1. Importance of the analysis 205 regions EU-25 2. Object of the analysis Demographic features Innovation and diversification 3. Data processing chain 4. Indicators Agricultural productivity Socio-economic context Efficiency and competitiveness Environmental sustainability

Results: Spatial Non-stationary Parameters 1. Importance of the analysis The variables affecting only locally the agricultural productivity are not only agricultural but also socio-economic and environmental variables 2. Object of the analysis 3. Data processing chain 4. Indicators Farmers age structure Agricultural environmental sustainability 5. Results: Non-stationary parameters Overall Economic development Overall and rural labour market Infrastructure Demographic features

Results: Cluster analysis EU-25 1. Importance of the analysis 2. Object of the analysis 3. Data processing chain 4. Indicators 5. Results: Non-stationary parameters Cluster 1: Mediterranean system: average development + intensive agriculture 5.1. Results: Cluster analysis EU-25 Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 2: Largest gap in development 4. Indicators 5. Results: Non-stationary parameters 5.1. Results: Cluster analysis EU-25 Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure 4. Indicators 5. Results: Non-stationary parameters 5.1. Results: Cluster analysis EU-25 Cluster 3a: Continental System: average development, intensive agirc. (UK) Cluster 3b: Continental System: high development, intensive & extensive agirc. (BE,DE,NL) Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure 4. Indicators 5. Results: Non-stationary parameters Cluster 4 (18) – Infrastructures, rural labour market and agricultural environmental sustainability Cluster 4: Large gap in development 5.1. Results: Cluster analysis EU-25 Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 5 (11) – Economic development, demographic structure, social infrastructure, rural labour market Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure 4. Indicators 5. Results: Non-stationary parameters Cluster 4 (18) – Infrastructures, rural labour market and agricultural environmental sustainability 5.1. Results: Cluster analysis EU-25 Continental System: average development, intensive agirc. Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 5 (11) – Economic development, demographic structure, social infrastructure, rural labour market Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure 4. Indicators Cluster 6 (21) – Part-time labour and farmers age structure 5. Results: Non-stationary parameters Cluster 4 (18) – Infrastructures, rural labour market and agricultural environmental sustainability 5.1. Results: Cluster analysis EU-25 Custer 6: Continental System: average development, extensive agirc. Cluster 1 (14) – Labour market and infrastructure

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 5 (11) – Economic development, demographic structure, social infrastructure, rural labour market Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure Cluster 7b: Highest development (AT) Cluster 7a: Continental System: average development, extensive agirc. (FR) 4. Indicators Cluster 6 (21) – Part-time labour and farmers age structure Cluster 7c: Continental System: high development, intensive & extensive agirc. (IT) 5. Results: Non-stationary parameters Cluster 4 (18) – Infrastructures, rural labour market and agricultural environmental sustainability 5.1. Results: Cluster analysis EU-25 Cluster 1 (14) – Labour market and infrastructure Cluster 7 (44) – Labour market

Results: Cluster analysis EU-25 1. Importance of the analysis Cluster 5 (11) – Economic development, demographic structure, social infrastructure, rural labour market Cluster 2 (20) – economic development, demographic structure, infrastructure, rural labour market and agricultural environmental sustainability 2. Object of the analysis 3. Data processing chain Cluster 3 (58) – Farmer age structure 4. Indicators Cluster 6 (21) – Part-time labour and farmers age structure Continental System: average development, extensive agirc. 5. Results: Non-stationary parameters Cluster 4 (18) – Infrastructures, rural labour market and agricultural environmental sustainability 5.1. Results: Cluster analysis EU-25 Cluster 8 (21) – Economic development, labour market, agricultural environmental sustainability Mediterranean system: low development, key or intensive agriculture Cluster 1 (14) – Labour market and infrastructure Cluster 7 (44) – Labour market

Conclusions Regionalization Variables affecting 1. Importance of the analysis Relationship between local agricultural systems and local socio-economic systems Variables affecting locally the agricultural productivity are not only agricultural but also socio-economic and environmental 2. Object of the analysis 3. Data processing chain Regions and Member States competitiveness capacity 4. Indicators Spatial coherence among groups of regions sharing geographic borders and sometime coincident with the reference State borders Great diversity between clusters in terms of profile 5. Results: Non-stationary parameters Regionalization Financial resources 5.1. Results: Cluster analysis EU-25 6. Conclusions