A model of Dutch agriculture based on Positive Mathematical Programming with regional and environmental applications

In the Netherlands few sectors are in the news as often as the agricultural sector is, and the news is rarely good. Nearly every day, in newspapers, on television and on the radio we are confronted with BSE, foot and mouth disease, swine and chicken fever, polluted animal feed, manure surpluses, subsidies, European Common Agricultural Policy (CAP), farmers' incomes and rural poverty. A lot of people in the Netherlands have written off the Dutch agricultural sector and believe that, as an economic activity, this sector is set to disappear in the near future just like the textile and shipbuilding industries did. However, the Dutch agricultural sector is continuously in a state of flux in order to adjust to ever changing circumstances. Besides, the agricultural sector is not an isolated activity, but embedded in and economically supported by other compartments of the agricultural production chain (agricultural processing and input delivering industries). This thesis contains a quantitative description of the Dutch agricultural sector. By means of a mathematical model insight is provided into the relationship between production and profits. Profits are achieved through the production of outputs. In chapters 1 to 4 we describe the sectors and the outputs that are included in the model. Next the mechanisms that determine the production of outputs in the agricultural sectors are described. We focus in particular on the use of joint resources in agriculture, manure markets and technology changes in dairy farming. Chapters 5 and 6 present the economic and environmental effects for the Dutch agricultural sector of changes in the CAP of the European Community and Dutch manure and nutrients policies. Chapter 7 discusses the strengths of the model and areas for improvement. It is concluded that in spite of rather drastic policy changes, the agricultural sector in the Netherlands still has a future.