The policy analysis matrix with profit-efficient data : evaluating profitability in rice cultivation

This paper combines policy analysis matrix and data envelopment analysis techniques to model the analysis of profitability from farming. Policy analysis matrices are computed for a sample of rice growers located in the wetland of the Albufera (Eastern Spain) under observed conventional and profit-efficient farming conditions. While conventional analysis points to a lack of profitability, farmers are shown to make positive profits at private and social prices when data reflecting efficiency adjustments are used in the analysis. The main conclusion is that the usefulness of the policy analysis matrix might be substantially enhanced by simulating profitability after efficiency-improving managerial decisions have been adopted. Additional key words: Albufera Natural Park, data envelopment analysis, European common agricultural policy, multifunctionality.

shown that important additional insights might be obtained if the farmers' efficient behaviour is considered, in addition to their observed behaviour.
This methodological approach is applied to rice farming in the Albufera Natural Park, a coastal wetland with great ecological value and located in the Eastern Spanish region of Valencia.This empirical application responds to the concern over whether or not those European farming systems that can be deemed multifunctional, because of the important environmental functions performed, will be able to survive in the policy context of the post-2003 common agricultural policy (CAP).
The CAP of the European Union (EU) is currently evolving under the combined pressure of internal requirements for change and the need to adjust in advance to future international trade agreements.The Uruguay Round of the GATT (1986-94) paved the way for an improvement in the access of third country exporters to the internal European market, and a further move in the direction of trade liberalisation is currently envisaged, as a likely outcome of the Doha Round negotiations (Swinbank, 2005).Partial or total decoupling of agricultural support from current production levels has been the answer of European policy-makers to the criticisms raised by foreign competitors concerning the socalled trade-distortion effects of the CAP.
For European authorities, the political problem of supporting farmers' incomes in an increasingly open economic environment has been further compounded by the need to take on board the impact of trade liberalisation on the non-commodity outputs of European agriculture.There is a growing recognition that, beyond its primary function of supplying food and fibre, agriculture can provide environmental benefits and contribute to the sustainable management of renewable natural resources, as well as to the preservation of biodiversity, and the maintenance of the economic viability of less favoured rural areas.These new concerns are frequently summarised under the heading of multifunctional agriculture and have become an integral part of the European model of agriculture (EC, 1999(EC, , 2000)).The research concerning the multifunctional character of agriculture is no longer restricted to international trade policy.A recent book included a variety of papers on different aspects of the multifunctionality of agriculture, focusing on the Spanish case (Gómez-Limón and Barreiro, 2007), while Spanish research on multifunctionality is reviewed in Reig (2006).Furthermore, starting with a basic piece of analysis by the OECD (2001), a variety of analytical tools to be used in the modelling of multifunctionality have been discussed in the last few years (Randall, 2002;Buysse et al., 2007) and some of them, mainly concerned with assessing social preferences, have been put to use in Spain (Gómez-Limón and Atance, 2004;Kallas et al., 2007).
Rice (Oryza sativa L.) farming provides an interesting case of a multifunctional crop that performs an important ecological role and where the EU has assumed the need to provide more room for imports from developing countries.Rice cultivation in Mediterranean wetlands represents a system of land management that, besides helping to shape highly valued traditional landscapes, performs an important non-marketable function linked to the protection of biodiversity and the environment.The Albufera Natural Park is a protected wetland area that is representative of the sort of rice fields that were mentioned as a source of positive environmental externalities in the review of the Spanish literature on agricultural multifunctionality, commissioned by the OECD (Tió and Atance, 2001).
The private and social profitability of rice farming is assessed, as previously noted, using the PAM.In addition, this paper goes one step beyond conventional prof itability analysis: instead of adopting a purely static viewpoint based on what farmers are currently doing, the perspective of what they could do in order to rise to the challenge posed by international competition is introduced.Rice farmers will have to adjust in the coming years to a less protective policy environment, by using their productive assets more efficiently and cutting costs, thereby improving their chances of survival in the face of strong import competition.Hence, a clear distinction between observed and eff icient farming behaviour is drawn, leading respectively to observed and efficient outcomes.The estimates of the efficient levels of input use, income, costs and profits are computed using DEA.Efficient 1 conditions are 1 In this paper efficiency is used with two different meanings.One, as in the present paragraph, refers to the adjustment of farms' input and output vectors to achieve maximum profits, for a set of prices, fixed factors and the current state of technology.It is used in connection with DEA computations.The other, used in connection with the PAM, refers to a social benchmark for the calculation of costs and revenues based on the adoption of international prices and the removal of the effects of subsidisation and taxation.potential for most of the farms and represent the productive plans that would prevail if farms were optimally operated, in terms of profit-efficiency.
Usually, the analysis of farming systems has attempted to assess farms' viability by dealing with actual farmers' behaviour, implicitly assuming that all farmers behave efficiently.But, one could legitimately ask: what would happen if the current farming practices of some individual farmers were inefficient when compared to best practices under presently available technologies?
The answer to this question has important economic policy implications.The impact of agricultural policies on farmers' income might be widely different under observed and eff icient behaviours.Likewise, the assessment of private and social profitability for a particular farming system can change substantially after major input adjustment decisions have been adopted in response to the diffusion of best management procedures.Profits obtained after all those adjustments could provide a useful benchmark for current production practices, showing whether enough room exists for an improvement in farms' financial situation.

Data and sample: the Albufera Natural Park
The Albufera Natural Park is a coastal wetland complex located nearby the Metropolitan Area of the city of Valencia (Eastern Spain).It protects 21,120 ha of wetlands and was declared a Natural Reserve by the Valencia Regional Government in 1986 and a Ramsar site2 in 1990.The Albufera is a fresh water coastal lagoon, fringed by rice fields that cover a surface area of 14,350 ha.
Rice fields act as seasonal aquatic ecosystems, given that they are flooded during summer, a season in which the Mediterranean wetland areas undergo drought conditions, and also during part of winter, for ecological reasons.Flooded rice fields around the lake provide the predominant regional feeding area for bird species such as ducks, common cranes and egrets, because the eutrophication of the waters of the Albufera prevents the lake itself from supplying enough food to cover birds' needs.It has been estimated that at least twenty five bird species of European conservationist concern use the rice fields in Eastern Spain during the winter, or as a place to rest and feed during their migrations (Fasola and Ruiz, 1997).
The dataset used in this paper corresponds to a sample of 131 single crop rice farms located in the Albufera Natural Park.The data were collected from a comprehensive survey carried out by the authors with support from the Spanish Ministry of Science and Technology, and correspond to the year 2004.The dataset provides data for one output and seven inputs.Output is measured in kilograms of rice production.The only fixed input is cultivated land, measured in hectares.Variable inputs are: labour (working days), in addition to capital, fertilisers, seeds, herbicides and fungicides, all of which are measured in euros.Table 1 presents a sample description for the data.
Labour input includes both family labour, embracing the farmer's and his family's on-farm labour, and hired labour.Input capital includes the cost of use of both farm-owned and rented machinery and equipment.
Labour is taken to be a variable factor of production because part-time farming has long been recognised as a structural characteristic of Valencian agriculture (Arnalte and Estruch, 2000).The region's highly diversified economic structure allows for alternative jobs in services or manufacturing industries in the same areas where rice farms are located.Likewise, many productive tasks are outsourced in the sense that they are carried out by external labour teams and rented machinery.
The price of rice has been established at 0.24 € kg -1 , and is assumed to be the same for all farms in the sample.The reason for this choice is that all farms produce similar varieties of rice, which is sold in the local market with no price differentiation.Familyowned labour has been priced using the wage earned by salaried workers on rice farms, as a conventional opportunity cost.In the same way, in order to compute the aggregate expenditure on capital services, the price of own capital services has been equated to the cost of hired machinery.Likewise, it is assumed that the price of labour and capital is the same for all farms, because the markets for both production factors are local markets with no observed differences in price.Finally, as fertilisers, seeds, herbicides and fungicides have all been measured by total expenditure, their price has been conventionally set to one3 .
The calculation of PAM matrices also involves the prices paid for the services of fixed production factors.The private rent of land has been established according to the most common quote for transactions in the local farmland rent market, which is currently around 721 € ha -1 .Input and output prices are displayed in Table 1.

Computation of profit-maximising productive plans with DEA
Microeconomic theory considers productive processes as the result of profit-optimising behaviour.Nonetheless, not all firms' managers are successful in achieving this goal and profit frontiers representing best practices need to be computed.Benchmarking productive activity and the computation of technological frontiers offer a suitable framework for evaluating firms' relative performance and designing productive plans that maximise firms' profits.
In agriculture, it has been occasionally argued that some farmers would not actually follow a profit maximising strategy, but rather a strategy aimed at maximising a utility function that does not necessarily match the profit function (Gómez-Limón et al., 2004).In order to test for this possibility, rice growers interviewed in our survey were asked to manifest their degree of agreement with the following assertion: «the most important target for a farm is to maximise profit».Possible responses ranked from 1 (total agreement) to 5 (total disagreement), 3 being the neutral answer.Based on this scale of responses, nearly 80% of farmers declared their agreement or total agreement with this statement.Thus, we can assume that rice growers in the Albufera tend to follow a profit maximising strategy and then evaluate their relative performance.
Here, DEA is used to compute productive plans that maximise short-run profit for given input and output prices.DEA techniques were introduced by Charnes et al. (1978), while Reig-Martínez and Picazo-Tadeo (2004) highlight their usefulness for analysing farming systems.In essence, these techniques evaluate the performance of peer units by constructing a surface over the data that allows the observed behaviour of a decision-making unit to be compared with best observed practices (see Cooper et al., 2004 for further details; also Alvarez-Pinilla, 2001).
Computing the productive plan that maximises short-run profit for farm k' requires its actual observed output and input data to be compared to those of the farms showing best observed practices, i.e. prof itefficient farms4 .Formalising, the profit maximising combination of variable inputs and output of farm k' arises from the following program: [1] subject to: being the observations of output and both f ixed and variable inputs of farm k, respectively.Furthermore, r and p v are the output and variable input prices respectively, while z k represents the weighting of each farm k in the composition of the technological frontier.Finally, variable returns to scale have been imposed (see Banker et al., 1984, for details).
As noted, it has been considered that the only fixed input is land, while the six variable inputs are fungicides, herbicides, fertilisers, seeds, labour and capital.The computation of program [1] for each rice farm in the sample shows that achieving prof it-eff iciency involves, on average, a reduction in the use of capital, fungicides, herbicides and, mainly, labour (Table 2).Conversely, the use of fertilisers and seeds slightly increases when moving from observed to eff icient productive plans.Finally, yields by hectare also increase slightly.

Construction of the PAM for rice cultivation in the Albufera Natural Park
The policy analysis matrix: theoretical aspects The PAM is a tool for quantitative policy analysis pioneered by Monke and Pearson (1989) which embodies many insights from international trade theory and costbenefit analysis.The PAM is the representation of two basic identities.The first identity defines profitability as the difference between income and costs (rows), whereas the second measures the effects of the differences in incomes, costs and prof its arising from distorting policies and market failures (columns).In this way, the matrix allows us to compute the effects of a particular policy or the adoption of a new technology on income, costs and profits.Table 3 shows a simplified PAM.
The rows of the matrix respectively represent: i) private profitability from farming production (D = A -B -C); ii) social profitability (H = E -F -G); iii) divergences between private and social valuations of revenue, costs and prof its.They represent a net balance from the application of a combination of policies that create economic distortions (trade protection, price support, exchange rate misalignment, among others), market failures, and correcting policies that aim to restore efficiency conditions.The columns of the matrix show income and profits, as well as a breakdown of costs into two components, tradable inputs and domestic production factors.The so-called intermediate inputs, like fertilisers or pesticides, must also be decomposed into elements of the tradable inputs type and into domestic factors.
The main purpose of constructing a PAM is to capture the differences between private and social profitability.Nonetheless, the latter, i.e. social profitability, is to be strictly understood in conventional efficiency terms, e.g.adopting international prices as a benchmark in the valuation of tradable goods, and therefore without encompassing other possible social objectives, such as the redistribution of income, food security or environmental protection.Some particular conventions are adopted for pricing outputs and inputs, in order to calculate social prof itability.For those outputs (E) and inputs (F) which are internationally traded, world prices (c.i.f. for imports and f.o.b. for exports) set up appropriate social values, whereas the valuation of domestic factors (G) corresponds to their opportunity cost, i.e. to the net income lost by not putting those factors to their best alternative use.
Differences between private and social valuations do not only affect tradable inputs and outputs.The valuation of domestic factors is also affected when the government taxes or subsidises land, capital or labour, or when their pricing is being affected by market failures.Whereas labour and capital are normally treated as variables, land is usually considered as a quasi-fixed factor in agriculture.
The PAM allows different ratios to be constructed, which are useful to discover whether a farming system enjoys a comparative advantage vis-à-vis the international market.The following three have been calculated in this paper: (i) Private Cost Ratio: [2] This is the quotient between the cost of the domestic factors, valued at private prices, and the value added, which is also calculated at private prices.The system will be competitive if the quotient is lower than or equal to unity.
(ii) Domestic Resource Cost Ratio: [3] This is the quotient between domestic factor costs valued at social prices and the value added, also computed at social prices.An agricultural system enjoys a comparative advantage if its DRCR ratio is less than unity, indicating that the economy is saving foreign exchange by means of domestic production.
(iii) Subsidy Ratio to Producers: [4] This ratio measures the net transfer to the farming system as a proportion of the total social income generated, allowing the analyst to discover to what extent economic policy is subsidising the system.A high SRP points to a lack of competitiveness, as the system's financial viability tends to depend on political decisions.
Since the seminal work by Monke and Pearson (1989), the PAM approach has been widely used.It has been applied to studying the profitability of maize cultivation in Portugal, before this country joined the European Community (Fox et al., 1990), and also in various developing countries (Nelson and Panggabean, 1991;Pearson et al., 1995;Yao, 1997;Adesina and Coulibaly, 1998;Fang and Beghin, 2000).The possibility of incorporating environmental considerations into the PAM has opened new perspectives for the analysis of farming in areas of high ecological value (Kydd et al., 1997;Pearson et al., 2003).The results of PAM analysis are always contingent to a specific set of output and input prices and input/output technical coeff icients, but matrices can be updated to incorporate both technological and price changes.
In this paper, the PAM methodology is employed in order to learn about the possibilities of maintaining rice cultivation in the Albufera Natural Park.As previously noted, two different matrices are built.The first is based on the observed values for inputs and outputs, revenue, costs and profits.The second matrix, which is termed efficient, is computed using the values of these variables adjusted to their respective profit-efficient levels.A fundamental assumption here is that improving farm efficiency does not negatively impact the production of environmental services in this particular ecosystem.Because the Albufera Park's and environmental legislation forbids agricultural practices that are judged damaging to the environment, this appears to be a reasonable assumption.

Computation of the conventional PAM matrix
A matrix was initially constructed on the basis of the techniques and costs observed in existing agricultural practices.Yields and input/output coefficients were obtained from the dataset and pricing conventions corresponding to the private prices row of the matrix which have already been described.Social prices were obtained from international prices (c.i.f.prices for imports) for paddy rice and for tradable inputs.Taking international prices as an efficiency benchmark follows a recommended practice, even in the presence of international market distortions (Monke and Pearson, 1989;Pearson et al., 2003).
Land rent at social prices is set equal to zero, given the impossibility of growing alternative crops on the land presently devoted to rice fields within the protection perimeter of the Albufera, both for legal reasons derived from the Natural Park regulations and for physical reasons connected to the seasonal flooding of the cultivation plots.Should abandonment be the alternative to rice growing (a plausible assumption under local conditions) the land's rent must be valued at zero cost for society in terms of efficiency.It is true that recreational activities or fishing could be carried out in this area, but not in the rice farmed plots.The Albufera lagoon, located in the centre of the Natural Park, is where such activities (tourism, professional fishing) are currently, and in the foreseeable future, taking place.
The input-output tables for the Valencian Region (Instituto Valenciano de Estadística, 1995) have been used to break down intermediate input costs into their tradable and domestic factor components.Value added tax has also been separated from the private prices of the tradable goods, as has the EU's external tariff rate, in order to obtain social prices.
Only slight differences remain between the valuations at private and social prices of the tradable inputs once tax effects have been eliminated, given the low or nil tariff rate applied to these goods.Larger differences have only been found for certain fungicides due to market price segmentation applied by multinational chemical companies.As for the output of paddy rice, the differences between domestic farm prices and international prices are signif icant and reflect the protection that the CAP grants to European growers.It has been considered an international or social price of 0.21 € kg -1 , which includes a cost of 0.04 € corresponding to unloading the rice at the port of Valencia and transporting it to warehouses.The domestic price for the grower has been set, as noted in Section «Data and sample: the Albufera Natural Park», at 0.24 € kg -1 .
The analysis has been completed by incorporating the support mechanisms for rice production, which came into force in the EU during 2005-06 (Regulations 1785/2003and 1782/2003;;OJ, 2003a,b), after the Mid-Term Review of the CAP.According to this legislation, rice farmers in the Albufera Natural Park are currently granted a coupled subsidy of 476.25 € ha -1 , in addition to a decoupled subsidy of 647.70 € ha -1 as a single payment.The effects of these support instruments on private profitability are supplemented by the agri-environmental payments being applied in cultivation areas included in the Ramsar list.These payments represent a compensation for the costs incurred by adopting environmentally-friendly cultivation techniques and amount to 397.63 € ha -1 for rice farmers in the Albufera Natural Park.Both agri-environmental payments and coupled subsidies have been included in the computation of revenue per hectare at private prices, but not the decoupled subsidies, as they do not include any obligation on farmers to grow rice.Table 4 shows the conventional PAM.

Recalculating the PAM matrix with profit-efficient data
Computing profit-maximising productive plans with DEA has allowed us to construct a virtual and representative farm that is termed efficient.This farm obtains higher revenue than the average observed farm, because yields per hectare are increased by almost 11%.The efficient farm also has lower costs than the average farm in the sample, because inputs are more economically managed (see Table 2).The main savings stem from a 52% reduction in labour costs 5 .Revenue increases and cost-cutting results in a remarkable improvement in rice farms' financial situation.
The revenue and cost figures of the efficient farm are used to build a new PAM.After some minor adjustments, such as increasing drying costs to reflect the increase in yields per hectare, the cells of this PAM have been computed by using the same pricing conventions and decomposition into tradable and non-tradable intermediate inputs as in constructing the conventional PAM.In addition, the same provisions have been made to reflect how private revenues are affected by policy measures arising from the agri-environmental payments and the coupled subsidies granted by the EU to rice farmers in the Albufera Natural Park.The private and social profitability of rice farming computed under productive plans that maximise profits are shown in Table 5.

Results and Discussion
The first finding comes from conventional PAM analysis and shows that rice farming in the Albufera was a non-profitable agricultural system, according to the conditions prevailing in 2004, in the aftermath of the Mid-Term CAP reform.The lack of social profitability is even more noteworthy than farmers' private losses.Lack of policy support shows up in output valuation, which drops, and in the elimination of subsidies.Costs are also lower at social prices, but not enough to  a These costs are slightly higher than in the PAM for observed production plans, because efficient production implies higher yields per hectare, which in turn imply higher drying costs b These fixed costs do not change from those of the observed production plans.
compensate for the income loss.The main item with a different valuation at social and private prices is land, because the social opportunity cost of the land rent is zero, as explained previously.
The computation of the PCR and the DRCR expound the basic weaknesses of this farming system (Table 6).The remuneration of the domestic factors per hectare exceeds the value added per hectare by 12%, when computed at private prices, and by 40% when computed at social prices.Rice farming in the Albufera of Valencia lacks any comparative advantage vis-à-vis the international market, in purely economic terms.The SRP amounts to 16%.The increase in private revenue over social revenue, as a consequence of trade protection, market regulations and environmental payments, represents the main way of operating social transfers to rice farmers.
Turning now to the PAM constructed using profitefficient productive plans, some impressive changes have taken place.Now profits are being made, both at private and social prices.Private revenue goes up by 7.4% and social revenue by 11%.Private costs diminish by 18% and social costs by 24%.The main savings correspond to the reduction in the use of herbicides and, particularly, to a sharp decrease in the use of labour.The expenditures linked to the use of capital are also reduced when farms adopt the best cultivation practices of profit-efficient farms.Bridging the gap between current inefficient management practices and efficient ones takes the average farm from a net loss of 309 € ha -1 to a net profit of 473 € ha -1 .Negative economic returns at social prices also turn to profits.Furthermore, under the eff icient scenario both the PCR and the DRCR remain below unity, pointing to the ability of this rice farming system to create value for the growers and also to add to national income at social prices (see again Table 6).
There is thus a sharp contrast between profitability under observed and efficient conditions.Under observed (non-efficient) conditions, only if the land rent were not included in the domestic factor costs and added to prof its would farmers obtain positive returns.The amalgamation of pure entrepreneurial profits and the remuneration of land allows those farmers that cultivate their own land to resist short-term competitive pressures to adjust to a greater farm size or to abandon farming.But in the long term it seems clear that the opportunity costs of all farm assets need to be considered in order to evaluate the economic alternatives that farmers have to face.

Concluding remarks
This paper performs a modelling exercise on the private and social profitability of a rice farming system located in the Albufera Natural Park, a protected wetland site of great ecological value located in the Spanish Mediterranean coast.In doing so, the policy analysis matrix and techniques of efficiency analysis based on data envelopment analysis are combined.On the one hand, a PAM based on observed data has been constructed.The results show that the average farm makes losses, both at private and social prices, when the opportunity costs of all the domestic factors involved in rice production are taken into account.In the long run, the survival of this system is clearly compromised because of its lack of international competitiveness, an outcome that could seriously endanger the preservation of both a highly regarded semi-natural landscape and also a wealth of biodiversity.
On the other hand, it has been ascertained whether pursuing a strategy of efficiency-augmenting managerial changes, based on the dissemination of the performance of the best practice farms in the sample, could take us to a substantially better scenario.With this purpose, DEA is used to calculate the productive plans that allow individual farms to become profit-efficient.An efficient PAM has been built on the basis of this information, yielding new estimates of private and social profitability.Now, farms are able to make positive profits and the society also obtains a net welfare gain from the resources allocated to rice production.So, an increase in the efficiency of rice growing may make this activity financially viable and guarantee the preservation of its multifunctionality.Also, PAM-based policy advice concerning the impact of distorting and efficiency-restoring policies on the profitability of rice growing is distinctively different under observed and profit-maximising scenarios.
It could be argued, with regard to the lack of social prof itability of rice farms with observed data, that social profitability is too narrowly defined in the PAM context, because it does not include a direct appraisal of the worth of the positive environmental externalities that stem from rice cultivation.The PAM methodology be extended by including the valuation of the public goods (landscape and biodiversity among them) jointly produced with the private or commercial output in the social row of the matrix.A trade-off could then arise between negative economic returns and the production of non-commercial, i.e. multifunctional, outputs.However, this line of thinking has not been pursued in this paper.
The lack of relevant empirical information that could be used for widening the scope of social efficiency prevents us from providing a sound justification of private and social losses grounded on society's quest for non-commodity outputs from agriculture.But differences between private and social prof its per hectare can be used to establish a lower threshold for the valuation of the annual supply of public good services jointly produced with rice output.Then, the computed figure can be compared with an independent estimate, e.g.contingent valuation, of the value of those services to the public6 .
Instead of pursuing a line of analysis that concentrates on the construction of an environmental PAM, the possibilities offered by computing a virtual PAM, assuming profit maximisation on behalf of farmers, is explored.This helps to assess whether there is a way out of the current financial difficulties rice growers are experiencing that could allow the valuable noncommercial functions currently performed by this farming system to be maintained.The findings point to a very positive outcome, both in terms of private and social profits, after farmers adopt the best practices of efficient farms.
Finally, it is worth highlighting a couple of the conclusions of this research.On the one hand, it vindicates the potential of the policy analysis matrix to yield fruitful information about particular farming systems.Furthermore, the usefulness of this methodological approach may be substantially enhanced if the analyst can simulate the profitability of the system after all sorts of eff iciency-improving changes have been adopted by farmers.On the other hand, the results of this research lead to a noteworthy conclusion in terms of economic policy.In order to preserve the nonmarketable function of the Albufera rice system linked to the protection of biodiversity and the environment, local and regional authorities need to make a greater effort to spread the adoption of best practices among rice farmers, helping them to improve their prof it efficiency and financial viability.

Table 1 .
Sample description

Table 3 .
A simplified policy analysis matrix

Table 2 .
Observed and short-run profit-maximising productive plans (averages per ha)

Table 4 .
Policy analysis matrix computed under oberved productive plans (€ ha -1 ) Cost of the energy used in the process of drying rice.b Other fixed costs: costs of water management, real estate taxes and harvest insurance. a

Table 6 .
Private and social profitability indicators for rice cultivation in the Albufera of Valencia

Including land rent in domestic costs a Including land rent in profits b Indicator PAM on observed PAM on profit- PAM on observed PAM on
Including the private valuation of land rent in cells C and G.A value equal to zero at social prices has been assumed for the land rent.b Including land rent in cells D and H. c Corresponds to the scenario of the reform of the Common Market Organisation (CMO) for rice in the Mid-Term Review. a