Distributional and income effects of CAP payments under the new CAP reform – The case of Germany

Abstract

Based on a brief overview on the state of negotiations on the implementation of the New CAP reform in Germany the distributional and income will be assed. The latter are due to an insignificant reduction of premium budget and the further harmonization of region flat rates toward national ones. However, the effects might be minor regarding the national implementation of Decoupled Payments since 2005, affecting land rental prices especially in less favored regions and grassland. More than by CAP the structural change and land rental prices in the last few years were heavily induced by the national support programs for bio-energies. The paper is based on simulations and expertise gained in policy evaluations in the field of CAP reforms.