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Abstract
The objective of this paper is to assess empirically the impacts of further reform of the Common
Agricultural Policy (CAP) on the agri-food sector in Finland. To meet the objective, an
econometric model for Finnish agriculture - built as a part of the AGMEMOD project - was
utilised. The projection and policy simulations presented in the paper demonstrate that the
model provides the basis for relatively straightforward baseline projection, and an initial
framework for agricultural policy analysis. Yet, there remains substantial scope for further
work on the model. In particular, the effects of big policy shocks are clearly not adequately
captured by the model. The linear equations of supply together with low elasticities estimated
from historical data generate simulation results, which do not in our opinion fully capture
farmers’ reactions to these changes.