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Abstract
The arable crop sector (COP) occupies a
prominent position within the European Union’s
agricultural sector. Within Spain, the COP sector
accounts for almost a third of total Agricultural
Guidance and Guarantee Fund expenses, and a half of
the utilised agricultural area. The COP sector is not only
relevant because of its physical and economic
magnitude, but also because of the political attention it
receives. The Common Agricultural Policy reforms that
occurred during the 1990s paid special attention to this
sector. This paper aims at determining the impacts of
Agenda 2000 on a sample of Spanish COP farmers’
production decisions by using an output-oriented
stochastic distance function. The distance function
allows assessing the reform-motivated changes on total
output, input used, input composition and crop mix. It
also permits to assess the impacts of the reform on
farms’ technical efficiency. Results show that the reform
has shifted outwards the production frontier and
changed output composition in favour of voluntary set
aside land. With respect to input composition, Agenda
2000 has induced a decrease in land, fertilizers and other
inputs in favour of labour. In addition, Agenda 2000 had
a negative impact on technical efficiency.