The political economy of the common market in milk and dairy products in the European Union.
FAO Economic and Social Development Paper - 142
This paper studies the policy delivery systems (PDSs) in the European Union (EU) for the implementation of the common dairy policy. It looks at the stated aims of the Common Agricultural Policy (CAP) and the dairy policy at the PDS Itself and at the conduct of policy. The analysis is based on four performance criteria: effectiveness (in fulfilment of aims), efficiency, enforceability and equity. Three case-studies illustrate how the common policy had to be partially adapted in Italy and the United Kingdom because of differences In the market and processing industry structure and show how the high level of efficiency of the PDS in the Netherlands affects the system throughout the EU. It is argued that the system is broadly effective in achieving the target price and that since the introduction of the quota policy it has been more effective (unexpectedly) in fulfilling the EU's farm income aims. The policy has not been efficient at all times insofar as it encouraged overproduction of unwanted products with weak markets at supported prices. The policy has proved enforceable in its detail, although it has been necessary to rely on the European Court of Justice to settle difficult issues when political machinery has failed. In terms of equity the policy has strengthened the rural economy in some of the EU's more remote areas, but it has also tolerated large differences around common price levels.