The aim of this study is to analyze alternative options of a Common Agricultural Policy
(CAP) after 2013 and their consequences for farms in Austria. Projections about the
development of agricultural markets are based on OECD-FAO forecasts. Using these
price projections, three alternative policy scenarios have been developed for a period
beyond 2013, which are compared with a baseline scenario. The three policy scenarios
encompass different assumptions on specific measures in the dairy sector and
higher modulation (13% versus the existing rate of 5%) as well as budget cuts in the
first pillar of CAP of 30% and 50%, respectively. All the scenarios have been analyzed
with the farm optimization system FAMOS, which differentiates among 5.796 typical
farms in Austria. FAMOS has been expanded and considers now the law of diminishing
costs and labor requirements with respect to farm size. Model results are presented
for organic and conventional farms by means of frequency distributions on percentage
changes in total gross margins. The results clearly indicate that uniform policy
changes can affect farms quite differently. There are winners and losers, which have
been identified according to farm characteristics
