Analytical tools and models to support policies related to agriculture and food

Society assigns an increasing number of objectives to the policies influencing the agricultural sector and rural areas that it expects to see fulfilled. Therefore, justifications for policies extend well beyond mere food production. Evidence-based policy making implies the development and maintenance of appropriate instruments for use in the design of these policies and for the monitoring of their effects, taking advantage of new socio-economic approaches and increased possibilities opened up by progress in the ICT area.

Scope

A. [2018] Developing new models supporting policies related to agriculture (RIA)

Modelling policies dealing with agriculture and the related management of renewable resources at various geographic scales implies the development of a new architecture taking advantage of progress in modelling approaches and ICT. Given the focus on local effects of global events and EU policies, new approaches should take into account the individual decision making unit (e.g. agent-based or machine learning-based approaches). Modelling will include such aspects as the environmental and climatic impacts of farming, delivery of ecosystem services modelling of aspects ranging from product / sector to farming systems, structural change including the transfer of production factors such as land, the integration of agriculture in rural society and will allow the establishment of links with biophysical models and geo-referenced datasets. Proposals will develop modelling at various geographic scales – from regional to global. They will build a highly modular and customisable suite of tools which will allow flexible use and further improvements as needs arise.

B. [2019] Modelling international trade in agri-food products (RIA)

Trade modelling has a long-standing tradition but some issues are notoriously difficult to assess and include in the existing simulation models. Proposals will develop appropriate methodologies to include some of these issues in existing trade models. These issues include (non-exhaustive):

• Non-tariff measures (NTM): The project will work on a methodology to assess the welfare effects of NTM (both positive and negative) and to include them in trade simulation models. This should go further than the standard gravity model approach which has strong downsides as discussed in the literature;
• Geographical Indications (GIs): The project will work on a methodology to assess the welfare effect of GIs and the resulting trade impacts of different schemes under trade negotiations;
• Zero trade flows: Current trade models have problems creating trade flows that did not exist before due to tariff or NTM reasons. This project will work on a methodology to overcome this bias;
• Quality differentiation: current trade models typically assume homogeneous goods. However, agri-food trade is becoming increasingly heterogeneous. The project should aim to broaden the commodity scope by including horizontal and vertical product differentiation trade models.

Proposals for both sub-topics should ensure that the approach proposed will be compatible with and improve the tools used at the European Commission. Proposals should include a task to cluster with other projects financed under the topic and with the modelling platform SUPREMA established under SFS-49-2017.

The Commission considers that proposals requesting a contribution from the EU of up to EUR 4 million for A and 5 million for B would allow this specific challenge to be addressed appropriately. Nonetheless, this does not preclude submission and selection of proposals requesting other amounts.

Expected Impact

• In the short term: improvement of the capacity to model policies dealing with agriculture and related natural resources, food and international trade;
• In the medium to long term: improvement of policy design, impact assessments and monitoring.

Cross-cutting Priorities

Socio-economic science and humanities