Investment behaviour of Polish farmers facing policy and market scenarios

This paper aims to analyse farm-household strategies and investment behaviour of Polish farmers facing different markets and policy scenarios, with a particular focus on the effects of the CAP. It is based on a direct survey of Polish farm-households, including information about farm and household structure, expectations, intended investments, reaction to policy measures such as decoupling of EU payments. Selected farm-households are modelled using multicriteria dynamic programming. Models simulate economic behaviour facing different scenarios on policy (decoupling and reduction of payments options) and markets (reduction of prices). The results show that CAP payments are usually used on-farm and are mostly concentrated on covering current costs and investment expenditures. Prospects of decoupling are expected to produce limited changes, including little increase in on-farm investments.