Spatial Modelling for Rural Policy Analysis

Abstract

The objective of the project was to provide the diverse group of interest groups associated with the agri-food sector (farmers, policy makers etc.) with a microsimulation tool for the analysis of the relationships among regions and localities. This tool would also be able to project the spatial implications of economic development and policy change in rural areas. To this end the SMILE (Simulation Model for the Irish Local Economy) model was developed. SMILE is a static and dynamic spatial microsimulation model designed to analyse the impact of policy change and economic development on rural areas in Ireland. The model developed provides projection for population growth, spatial information on incomes and models farm activity at the electoral division (ED) level. The sub-projects funded under this project were concerned with the simulation, development and enhancement of a spatial econometric model of the Irish rural economy which would compliment the existing econometric models used in Teagasc; focusing on the agriculture and food sectors, previously constructed under the auspices of the FAPRI-Ireland Partnership by staff at Teagasc and NUI Maynooth. That partnership has produced an econometric model of the entire agri-food sector that has been simulated to produce estimates of the impact of policy changes on commodity prices, agricultural sector variables, food industry production, consumption of food both in Ireland and the EU and trade in food products, as well as costs, revenue and income of the agricultural sector. The SMILE model was built to compliment these other econometric models by using an holistic modeling approach that takes into account the spatial difference of rural populations, rural labour force and rural income.