RESEARCH PAPER
IMPACT OF DIRECT PAYMENTS ON THE DISTRIBUTION AREA – MODEL APPROACH
 
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Warsaw School of Economics Warsaw
Acceptance date: 2017-03-09
Publication date: 2017-03-09
 
Zagadnienia Ekonomiki Rolnej / Problems of Agricultural Economics 2017;350(1):75–100
 
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ABSTRACT
The paper explores the impact of the key types of instruments co-creating the direct support scheme used under the Common Agricultural Policy, i.e. area support, coupled support and historical support, on the income distribution area. The impact of area payments and coupled support on remuneration for factors of production was researched using the model of direct payments transformation into wages, profits and ground rent, and introducing the term of rent-formation coefficient. This also allowed to capture the specificity of historical support. Identification of the mechanism of direct payments transformation into remuneration of the factors of production was the starting point for analysis of the phenomenon of taking over payments by owners of land and the phenomenon of capitalisation of payments in the price of agricultural land. Moreover, using the partial equilibrium model the paper illustrated the idea behind thephenomenon of taking over payments by buyers of agricultural products.
eISSN:2392-3458
ISSN:0044-1600