Umeå Economic Studies,
Umeå University, Department of Economics

Abstract: This thesis consists of a summary and four papers. The first two papers address political economy and industrial organization aspects of agricultural policy, and the last two international aspects of environmental policy. Paper [1] explains Common Agricultural Policy (CAP) subsidies to farmers by the influence of farmer interest-groups with an EU-wide membership. The analysis is based on panel-data for fifteen commodities over the period 1986-2003. Because the CAP is set as an overall EU policy, effective lobbying presents a collective action problem to the farmers of the EU as a whole. Indicators of lobbying, which are based on this perception, are found to explain part of the variation in agricultural support. In Paper [II], the Bresnahan-Lau framework is used to analyze whether policy reforms, i.e. the two-price system (an input quota, 1986-1991) and a general deregulation of dairy policy (1991-1994) had any market power effects on the Swedish butter market. The results show that the null hypothesis of no market power cannot be rejected, for any of the specific policy reforms, at any reasonable significance level. Paper [III] concerns the welfare consequences of environmental policy cooperation. It is assumed that countries finance their public expenditures by using distortionary taxes, and that they differ with respect to competition in the labor market. It is shown how the welfare effect of an increase in the expenditures on abatement depends on changes in environmental damage, employment and work hours. The welfare effect is also related to the strategic interaction among the countries in the prereform equilibrium. In Paper [IV] environmental policy in an economic federation, where each national government faces a mixed tax problem, is addressed. It is assumed that the federal government sets emission targets, which are implemented at the national level. It is also assumed that the economic federation is decentralized. The results highlight a strategic role of income and commodity taxation, i.e. each country uses its policy instruments, at least in part, to influence the emission target.

Keywords: agricultural policy; political economy; lobbying; cooperatives; market power; policy cooperation; distortionary taxes; labor market; Nash game; Stackelberg game; income and commodity taxation; economic federation; environmental policy

JEL-codes: D62; H21; H41; H43; H70; J51; J60; L22; L51; L66; Q11; Q18

116 pages, November 16, 2007

Full text files

DownloadAsset.action...Id=3&assetKey=ues719  

Download statistics

• Umeå University, Department of Economics
• Ordering Working Papers
• Home page for this series

Questions (including download problems) about the papers in this series should be directed to David Skog ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:umnees:0719This page generated on 2024-09-13 22:17:26.