why democracies produce efficient results by applying the standard tools of microeconomic analysis i argue that democratic markets work as well as economic markets in particular i show that previous work has greatly exaggerated the existence of principal agent and informational problems in electoral markets and has drawn incorrect conclusions

predatory versus productive government the case of u s agricultural policies this essay will argue that agricultural policy in the united states has led to both the enhancement of efficiency through productive policies and the transfer of wealth and income to special interests through redistributive or predatory policies these two activities can be labeled as pests and perts pest policies or political economic seeking transfers are meant to redistribute wealth from one social group to another and are not explicitly concerned with efficiency in contrast perts or political economic resource transactions are intended to correct market failures or to provide public goods these policies have neutral distributional effects at least in design a review of the history of public policy in agriculture reveals not only tension between the pert and pest roles of the public sector but also some coordination between these two types of activities as different interest groups pressure the political process the government trades off pests and perts in its attempts to acquire balance and secure political power at times this has led to combinations of programs that appear incoherent in such a world the challenge for economists is to design and advocate policies that are both economically productive and politically sustainable

political economy of public policies insights from distortions to agricultural and food markets the agricultural and food sector is an ideal case for investigating the political economy of public policies many of the policy developments in this sector since the 1950s have been sudden and transformational while others have been gradual but persistent this paper reviews and synthesizes the literature on trends and fluctuations in market distortions and the political economy explanations that have been advanced based on a rich global data set covering a half century of evidence on commodities countries and policy instruments the paper identifies hypotheses that have been explored in the literature on the extent of market distortions and the conditions under which reform may be feasible

the impact of cap reform on farmers plans for the future some evidence from south west england this paper considers farmer intentions following the implementation of the 2003 cap reforms identifies the extent to which these plans have been influenced by the introduction of the single payment scheme sps in 2005 and considers the implications in terms of likely structural change i e changes in the deployment of land labour and capital the analysis uses data from a large sample survey of farmers in south west england and the results indicate that cap reform is not stimulating rapid agricultural restructuring rather it appears to be reinforcing many existing trends towards diversification and an increasing polarisation between the largest and smallest farms cap reform is impacting unevenly on the farm community and different farming situations are associated with different types of reaction market signals may become a more powerful driver of farmer behaviour in which case the 2003 reforms will have proved successful in providing farmers the freedom to farm without coupled subsidies on the basis of the results presented in this paper though only a minority of farmers seem both well placed and well disposed to exploit such opportunities

measuring the social costs of suboptimal combinations of policy instruments a general framework and an example abstract since most agricultural programs employ two or more policy instruments simultaneously it is notable that little research has attempted to find optimal instrument combinations and no research exists which evaluates the social costs unrealized benefits of combining instruments suboptimally in our paper we report a simple and feasible method to find optimal policy instrument combinations and we provide the first general formal approach to measuring the social costs of suboptimal policy instrument combinations our approach is illustrated in an analysis for five major u s crops corn feed grains wheat rice cotton the simple model we employ for the illustration suggests that except for the feed grains program the observed programs combined policy instruments quite suboptimally we conclude that agricultural economics research now can and should begin placing increased emphasis on studying optimal policy instrument combinations

the eu budget battle assessing the trade and welfare impacts of cap budgetary reform abstract there is a paucity of quantitative impact assessments of the sectorial and macroeconomic impacts of cap budget reform for eu member states to fill this gap the current study employs a sophisticated agricultural variant of the gtap model to evaluate the recently agreed cap spending limits for the financial period 2014 2020 as well as a more radical 50 cut to the cap budget proposed by the uk government the study incorporates methodological innovation in terms of the modelling of cap budgetary mechanisms furthermore official eu auditing statistics are employed to i greatly improve the existing representation of agricultural support payments in the gtap benchmark data and ii implement a detailed contemporary cap baseline for member states to capture both the decoupled coupled split of support payments and the distribution of support across both pillars in general cap expenditure cuts have muted impacts on eu and world agricultural markets whereas changes in net transfer payments have implications for real income and macro trade balances in eu member states this observation is particularly pertinent when assessing conciliatory reductions in the uk rebate in exchange for deeper cap budget cuts

abolishing biofuel policies possible impacts on agricultural price levels price variability and global food security abstract in this paper we assess the impact of abolishing biofuel policies mandates tax credits import and export tariffs on agricultural price levels and price variability as well as some aspects related to global food security for the analysis we employ a recursive dynamic agricultural multi commodity model within a stochastic framework results of the 10 years forward looking scenario indicate that the removal of biofuel policies would have a significant effect on price variability of biofuels but only a marginal impact on the variability of agricultural commodity prices without biofuel policies global biofuel demand would decrease by 25 for ethanol and 32 for biodiesel moreover prices would only moderately decrease for ethanol feedstock commodities like wheat and coarse grains while prices for biodiesel feedstock commodities specifically vegetable oils would be more affected due to competing uses of crop production such as feed and industrial use abolishing biofuel policies would not necessarily lead to an increase in global food security as food use increases would remain low for most crops and regions

the verticality of policy mixes for sustainability transitions a case study of solar water heating in china abstract climate change and sustainable development are the defining challenges of the modern era the field of sustainability transitions seeks systematic solutions for fundamental transformations of socio technical systems towards sustainability and exploring the role of policy mixes has been a central research agenda within the field in the extant literature there exists a lack of both conceptual and empirical research on the vertical dimension of policy mixes for sustainability transitions this study provides a multilevel and evolutionary interpretation of the vertical interactions of policy mixes in the process of industrial path development towards sustainability transitions an exemplary case of solar water heating swh technology in shandong province in china is presented capturing both the bottom up and top down processes of interactions on the one hand urban level policy initiatives can inform higher level policymaking on the other hand national level priorities can greatly configure policy strategies for lower level governments moreover as the industry matures the interactions of multilevel policy mixes evolve from simpler unidirectional patterns to more complex bidirectional ones through a vertical policy learning feedback mechanism this study generates two important policy implications that extend beyond the chinese context first dynamic vertical interactions between multilevel governments indicate the need to develop more nuanced perspectives on the design of policy mixes second policy makers need to hold a more dynamic view of policy mixes by recognizing their temporal and coevolutionary nature through the policy learning process

the governance of sustainable socio technical transitions a quasi evolutionary model of socio technical transitions is described in which regimes face selection pressures continuously differentiated transition contexts determine the form and direction of regime change in response to these pressures the articulation of pressures and the degree to which responses are coordinated and based on resources available within the regime define the transition context four alternative contexts are described endogenous renewal re orientation of trajectories emergent transformation and purposive transitions agency and power in the governance of regime transformation are analysed power to affect change depends on regime membership the distribution of resources for change and expectations

dynamics of asymmetric conflict the case of the german milk conflict the german milk conflict developed when an emerging farmer association challenged the large incumbent in the wake of an insufficiently communicated policy change abolition of the milk quota the organizations represent opposing sides of a common policy debate market liberalization versus regulation the study analyzed the patterns between the two organizations and proposed a grounded theory of asymmetric conflict due to the elevated level of emotions during the conflict the study used a qualitative research approach based on 34 in depth interviews the analysis uncovered the interlocking patterns of simplification and emotionalization by the smaller association and rationalizing by the larger association results indicate how an active opponent can use policy changes to its advantage and how to prevent such a development recommendations based on the grounded theory developed such as implementing suitable communication strategies are transferable to a variety of changes and conflict situations in complex environments such as the food and agricultural sector

managing food price risks and instability in a liberalizing market environment overview and policy options abstract managing food price risks and instability is a major challenge in the midst of ongoing food market reforms key findings from the papers in this special volume revolve around five broad areas i the sources and magnitudes of food price instability in different country contexts ii the economic and social costs stemming from price instability iii the lessons from food market reforms to date iv the design of policy reforms in ways that promote efficient and stable market development and protect the interests of the poor and v potential policy responses to food price instability in a liberalizing market environment

productive and predatory public policies research expenditures and producer subsidies in agriculture governments are postulated to maximize a political preference function in choosing two policy instruments research expenditures a productive policy that improve social welfare and production subsidies a predatory policy that incur deadweight losses each policy affects the distribution of income between producers and consumers governments determine the optimal mix of policies taking into account interaction effects between research and subsidy expenditures in addition to providing an explanation for underinvestment in research the paper determines conditions under which research and subsidy policies are complementary such conditions are shown to characterize u s agriculture underinvestment in research is therefore less severe than in some other countries

innovation and policy for bioenergy in the uk a co evolutionary perspective de laurentis c innovation and policy for bioenergy in the uk a co evolutionary perspective regional studies this paper analyses the role of niche innovation and regime interaction in the field of renewable energy in the uk adopting a co evolutionary approach and a dynamic multilevel perspective on system innovation it investigates niches development in the uk in the field of bioenergy and its interaction with the current energy regime contributing to the debate about spatial scales at which sustainability transitions can be conceptualized the paper utilizes the case of niche development in the region of wales to provide supporting evidence of the importance of context specific social and political relations that may foster or hinder regime transformation

escaping carbon lock in this article explores the climate policy implications of the arguments made in understanding carbon lock in unruh 2000 which posited that industrial countries have become locked into fossil fuel based energy systems through path dependent processes driven by increasing returns to scale carbon lock in arises through technological organizational social and institutional co evolution culminating in what was termed as techno institutional complex tic in order to resolve the climate problem an escape from the lock in condition is required however due to the self referential nature of tic escape conditions are unlikely to be generated internally and it is argued here that exogenous forces are probably required

the political economy of public research investment and commodity policies in agriculture an empirical study the paper tests a political economy theory of simultaneous government decision making on income redistribution through commodity policies and on public research investment in agriculture we use data from 37 countries on agricultural protection and public agricultural research expenditures pari the empirical results are consistent with the political economy hypotheses the analysis suggest that structural changes in the economy have important effects on the political incentives for governments not only to subsidize or tax farmers but also to invest in public agricultural research furthermore the analysis supports the hypotheses that the impact of such structural changes on government decision making on pari is non linear and conditional on other factors regarding the impact of political institutions the results suggest that more democracy neither leads to more distortionary transfers agricultural protection nor to lower investment in public goods pari

london and beyond taking a closer look at urban energy policy this paper considers the field of urban energy policy a neglected yet important topic cities account for approximately two thirds of global primary energy consumption creating significant benefits and costs as a result there has been growing interest in the contribution of cities to global energy policy issues such as climate change but a number of significant questions remain e g how do energy policy processes differ between national and urban scales and how can cities contribute most effectively to global policy goals we present the results of interviews with key stakeholders in london to illustrate some unique features of the urban energy policy cycle we then take a wider view proposing a research agenda with three key goals describing the global variety of urban energy consumption and policy understanding the resulting diversity in responsibility vulnerability and capacity and developing shared procedures and solutions tackling these questions is vital if cities are to contribute fully to current energy policy efforts

the microeconomics of the developmental paradox on the political economy of food price policy abstract a longstanding puzzle in comparative economics is the developmental paradox the tendency for government support for agriculture to increase with national income and to decrease with the proportion of economic activity and of the population in agriculture this paper offers a microeconomic explanation for that puzzle it establishes analytically the microeconomic basis for coalition alignments with respect to food price policy then numerically simulates the comparative static effects of alternative food policies on coalition structure a parsimonious household model applied to a heterogeneously endowed society demonstrates how variation in individual welfare effects might beget distinct coalitions in the debate over food price policy and how those policies are inextricably linked to land population and technology policies in food agriculture moreover coalition alignments on particular policy debates are path dependent in particular food price policy creates its own political support

the two dimensions of policy impacts on economic cohesion concept and illustration for the cap abstract given the growing importance of cohesion policy within the european union eu during the last two decades public and scientific interest in the role of eu policies for regional disparities has risen continuously recent empirical studies on the impacts of the common agricultural policy cap on economic cohesion have been strikingly diverse in their principal findings whereas some studies suggest positive overall effects on economic cohesion others stress exactly the opposite one major reason for the ambiguous results is that a single agreed upon measure of economic cohesion is lacking we propose a concept that distinguishes between two dimensions of policy impacts on economic cohesion i the redistributive impact at a defined period of time and ii the change of the redistributive impact over time the first dimension addresses the question whether a policy makes the distribution of a target variable e g income more equal or unequal at one point of time the second dimension covers the impact of the policy on the disparity of the same variable over time i e the impact on convergence an empirical illustration of the concept for 13 nuts 1 regions in germany over the period 1991 2009 reveals that the two policy impacts of the cap are partly contradictory for the two dimensions it is shown that the cap fosters economic cohesion by reducing regional disparities in each individual year with regard to redistributive impacts over time we find that cap transfers leave income convergence largely unaffected for society as a whole within the agricultural sector it leads to a convergence of receipts per farm whereas it induces a divergence of farm receipts per hectare

judging agricultural policies a survey this survey provides a structured picture of 40 years of literature which uses welfare economic tools to judge agricultural policy challenges and developments of normative agricultural policy analysis are discussed in an easily accessible graphical framework it is shown how the literature has gone from examining a very small discrete set of simple policies to a much broader often continuous set of policies that combine policy instruments simultaneously the importance of the pareto criterion used to explore the limits of how government can affect welfare is revealed moreover given the importance of the objective of income redistribution in agricultural policy agricultural economists have often departed from the purely efficiency oriented tradition in economics it is shown that they have tried to incorporate equity considerations by either adding these criteria as constraints to the social welfare function or directly incorporating these criteria in the functional form of the social welfare function

donors and domestic policy makers two worlds in agricultural policy making in recent decades many developing countries have moved from taxing their agricultural sector to subsidizing it a phenomenon referred to as overshooting using ghana and uganda as case study countries this study aims to contribute to explaining this phenomenon by examining the role of policy beliefs the study is based on the advocacy coalition framework and relies on discourse analysis as analytical method in depth interviews with policy actors in both countries served as empirical basis a quantitative analysis of the transcripts was used to identify different discourse coalitions and a qualitative analysis was conducted to examine the discourses and identify their underlying policy beliefs the paper identified far reaching differences in the agricultural policy beliefs between domestic policy makers and donors regarding the question what does it actually take to develop small holder agriculture the evidence from this analysis highlights the role that divergent policy beliefs can play in influencing agricultural policy choices

trading off volatility and distortions food policy during price spikes this paper analyses the trade off between price distortions and reduced volatility when governments intervened in agricultural and food markets during the recent food price spikes we develop a model to derive how much distortions a government would introduce when it cares about price stability in a situation with limited policy options we show that there is a trade off and identify the optimal combination of distortions and stability for given international price shocks and interest groups preferences for stability we compare these theoretical findings with empirical indicators on actual government interventions in staple food markets we find that several countries have been able to reduce short run price volatility in the domestic markets while at the same time allowing structural medium and long term price changes to pass through to producers and consumers however this is not the general case for many countries even when explicitly taking into account the trade off and the benefits of reducing volatility government policies appear far removed from the optimal trade off and there appears to be much room for policy improvement

emerging in between the multi level governance of renewable energy in the english regions abstract analysis explains the emergence of a regional dimension to the multi level governance of renewable energy in england the case sits in a tense yet informative position between the two poles of ordered and messy multi level governance these tensions which are currently debilitating could be rendered more creative and fruitful if greater authority was devolved to the regions and if policy learning between the regions and the central government was institutionalised more deeply improved legitimacy and accountability mechanisms must accompany increased authority however english ambivalence over regionalisation generally means such changes are unlikely

carbon footprint in green public procurement policy evaluation from a case study in the food sector abstract several projects across europe are focused on improving sustainability of public procurements however few of them are measuring the environmental savings achieved by specific policies through the application of environmental impact assessment indicators in this paper we calculate environmental savings by applying a carbon footprint analysis to three food policies implemented by the city of turin italy in the school catering service school years 2012 13 and 2013 14 the policies are focused on i the production of food with the requirement of integrated or organic products ii the geographical origin of the food with the requirement of regional food provisioning and iii the improvement of urban distribution with the requirement of shifting to natural gas vehicles the climate change potential of five of the most consumed foods were studied according to three main phases of the supply chain production including all processes in a cradle to gate perspective provisioning focusing on the transportation from production sites to the peripheral food hubs of the city and distribution focusing on the transportation from the city hubs to schools the results of this study highlight the different climate impacts of the three phases of the supply chain in particular 61 70 of the greenhouse gases are emitted in the production phase 6 11 in the provisioning phase and 24 28 in urban distribution as a consequence policies that affect production practices have the greatest potential for reducing the carbon footprint of the catering service other policies such as those on transportation can have controversial effects therefore to improve planning of sustainability policies the greenhouse gas emission savings achieved by each policy must be analysed in depth