**_33_**

_Price Support at Any Price?_

**Tab.5.3 EU membership - adjustment path Simulation experiments: MACROECONOMIC IMPACT**

||Fast path<br>reduct<br>(EU<br>pr.<br>by 200|/output<br>ion<br>0,<br>quotas)|Gradual in<br>**full**fin|tegration<br>ancing|Gradual in<br>budget co|tegration<br>nstrained|
|---|---|---|---|---|---|---|
|**l**<br>__________________|Index<br>2010<br>(base=**100**<br>)________<br>|growth<br>rate<br>(aver.)<br>**199___**<br>_<br>**1 -20**<br>**1 0**<br>**1991201991-201**|Index<br>2010<br>(base= 100<br>**)**|growth<br>rate<br>(aver.)<br>**1**|Index<br>2010<br>(base=**100**|growth<br>rate<br>(aver)<br>19**2091-**|
|**Gross**Domestic<br>Product|97.1|4.2%|105.6|<br>4.7%|103.1|4.5%|
|Fixed Capital Formation|89.1|6.4%|113.2|7.7%|106.2|7.4%|
|Personal Consumption|98.8|3.7%|104.8|4.0%|102.5|3.9%|
|_of which:_<br>Food products<br> &|95.5<br>|1.4%<br>|99.7<br>|1.6%<br>|98.9<br> <br>|1.6%<br>|
|Other goods services|99.8|_4.5%_|106.4|4.9%7|<br>103.6|4.8%|
|<br>_ource: Model POLAGR, sim_<br>Both scenarios le<br>onsumption levels are h<br>vels is compensated by<br>ociety may afford more<br>ase run) is not big, and<br>Figure 14 shows<br>ositivemacroeconomic <br>oth integration scenario<br>ase of the BUDGET|_ulation Jan. 1995_<br>ad to signific<br>igher than in<br>much higher<br>expensive foo<br>a scale of pro<br>an overall<br> impact of<br>s. In the|<br>antly higher<br>the base run<br>consumptio<br>d: the fall<br>duction sur<br> <br>|levels of sa<br>(the food c<br>n of other g<br>of domestic f<br>pluses signif<br>**EU**mem<br>**DIAgb from**<br>go<br>**_bn_**<br>|vings and inv<br>onsumption s<br>oods and ser<br>ood consum<br>icantly lowe<br>bership<br>- a<br>**Im pacton**<br>**_m_**<br>**In %**|estment. Al<br>lightly below<br>vices). A rel<br>ption (with re<br>r than in the<br>djustme<br> **GDP**|so<br>the base run<br>atively richer<br>spect to the<br>base run.<br>nt path|
|ONSTRAINED scenari<br>smaller, reaching almo<br>dditional 0.2 per cent p<br>conomic growth. In the<br>ULL FINANCING, ho|o the impact<br>st an<br>oint of the<br>case of the<br>wever, the|6<br>4<br>2<br>||l<br>|/<br>-<br>-|Graduallnt<br>a<br>_|fullflnanadng<br>1|
|acroeconomic gains ex|ceed 0.3 per|0<br>°|||Gradua**l** nt|,budgetconstr.|
|ent points of an additio<br>DP growth. Such an|nal yearly<br>outcome is|**-2**<br>Fig<br>e|41<br>,|,<br>,<br>**I**|||

_Source: Model POLAGR, simulation Jan. 1995_ Both scenarios lead to significantly higher levels of savings and investment. Also consumption levels are higher than in the base run (the food consumption slightly below the base run levels is compensated by much higher consumption of other goods and services). A relatively richer society may afford more expensive food: the fall of domestic food consumption (with respect to the base run) is not big, and a scale of production surpluses significantly lower than in the base run.

Figure 14 shows an overall positive macroeconomic impact of both integration scenarios. In the case of the BUDGET CONSTRAINED scenario the impact is smaller, reaching almost an additional 0.2 per cent point of the economic growth. In the case of the FULL FINANCING, however, the macroeconomic gains exceed 0.3 per cent points of an additional yearly GDP growth. Such an outcome is Figure 14