Important legal notice
AGRILIFE- Agriculture and life sciences in the economy
SUSTAG - Sustainable Agriculture
Ex-ante Spatial Policy Impact Analysis of the Rural Development Policy in European Rural Areas (RURAL ECMOD)


The objective of this project is to improve understanding of the regional economy impacts of CAP policy instruments, and in particular the impacts associated with a move-away from an agriculture-centred focus to an approach aimed at the balanced and sustainable development of EU rural areas.

The project uses a dynamic Computable General Equilibrium (CGE) model to assess the impacts of changes in the structure of the Common Agricultural Policy with a particular focus on Axis 3 rural policy measures (Rural Development Regulation), (improving the quality of life in rural areas and encouraging diversification of economic activity) on NUTS 3 regions in rural/urban breakdown.

It follows previous IPTS research work on ex-ante rural development policy impacts assessment, such as reviews of existing rural typologies and their links to models, as well as the building of a specific rural-oriented regional typology to be used in connection with a range of socio-economic regional models and tested with an Input-Output model at NUTS 3 level (see TERA-SIAP project).

Building a Typology of European Rural Areas for the Spatial Impact Assessment of Policies (TERA-SIAP)

Common Feature of Diverse European Rural Areas: Review of Approaches to Rural Typology


The objectives are achieved through several activities, such as:

- the selection of six NUTS 3 case study regions, by means of the TERA-SIAP typology, covering the diversity of regions within EU 27;

- the assessment of Axis 3 instruments of RDP in case study areas through a CGE model approach (IFPRI standard CGE model and its modifications). This assessment implies the construction of Social Accounting Matrices (SAM) for selected regions explicitly distinguishing urban and rural economies, as well as explicitly including agricultural and tourism sectors. Scenarios analysed (see table below) include shifts in the type of applied RDP instruments.

RURAL ECMOD Policy scenarios

Scenario 1 "Agricultural" RDP All RDP on Axes 1 and 2
Scenario 2 Diversification RDP All RDP on Axis 3
Scenario 3 30% Reduction in nominal Pillar 1 support  
Scenario 4 Rebalancing scenario EU-wide flat rate SFP
Scenario 5 Farm household diversification All Axis 3 switched to measure 311
Scenario 6 Non-farm diversification All Axis 3 switched to measures 312 and 313
Scenario 7 Rural public infrastructures All Axis 3 switched to measures 321, 322and 323

Notes: Corresponding measures

311:Diversification into non-agricultural activities

312: Support for business creation and development

313: Encouragement of tourism activities

321: Basic services for the economy and rural population

322: Village renewal and development

323: Conservation and upgrading of the rural heritage

- the interpretation and conclusions on results show the range of possible effects (direct and indirect) with respect to applied types of policy instruments, scenarios of policy measures changes and development of non-policy exogenous factors. Tests on regional transferability are also carried out.


Policy brief - Policy brief RURAL ECMOD

Technical report - RURAL ECMOD


WP1Report - Case study - region selection

WP2 Report - Modelling approach, SAM construction and model calibration

WP3 Report - CGE model application and scenario analysis: Case Study Regions of Aberdeen City & Aberdeenshire, Arkadia and Jihomoravsky kraj

Excel workbook Appendix 2 - RURAL-ECMOD_TIA.xls


Fabien Santini, María Espinosa, Sergio Gomez y Paloma, Sebastien Mary
Joint Research Centre