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Abstract

The aim of the paper is to provide an econometric, dynamic, multi-product and partial equilibrium model for the Spanish agriculture able to analyse the effects of the SFP and subsequent reforms in both the irrigated and non-irrigated cultivation. In the case of the EU Mediterranean countries, irrigated agriculture is very relevant because farmers in irrigated land get higher productivity and returns. However, irrigation is also the source of a number of environmental concerns, such as over-abstraction of water from subterranean aquifers, irrigation driven erosion, soil salinisation, etc.. The new decoupling direct payments from production will reduce many of the incentives to intensive production. The developed model is called Spanish Econometric Simulation of Agricultural Policies (SESAP) and it is estimated using Eurotat data from 1983 to 2004 and solved using the GAMS software for the period 2005 to 2020. Simulation results indicate that irrigated area harvested for arable crops, less environmental friendly, is expected to decrease more than non-irrigated.

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