The objective of the paper is twofold. Firstly, investigating the relationship between competitiveness, measured by technical efficiency, and direct payments of a sample of Italian farms prior to the application of the 2014-2020 CAP reform. Secondly, evaluating possible implications of alternative scenarios about distribution of direct payments on technical efficiency. To these aims, a data envelopment analysis approach in conjunction with a double bootstrapped left-truncated regression model are adopted. Results indicate that direct payments are negatively associated with technical efficiency. Moreover, they show that redistribution of policy subsidies especially towards more inefficient farms provokes a decrease in overall technical efficiency.