Institutions matter, but they are usually not part of applied economic policy modeling, which is primarily concerned with the consequences of agricultural policies. These models leave unexplained many of the causes of observed agricultural policies. As su ch, the models cannot be used to analyze how changes in the political institutions may affect policies and economic performance in the agricultural sector. Therefore, these models provide no aid to developing or changing policy-making institutions in a so cially beneficial manner.
It is commonly believed that the existing system in Norway helps farmers to maintain a higher rate of protection compared to a system in which farmers would have less institutionalized influence. But this hypothesis has never be en formally tested. It may well be the case that given the rules underlying the legislative process, the observed agricultural policies constitute a kind of equilibrium outcome of the political process. Whether this process should be judged efficient depe nds on the detailed institutional aspects of the process, so it is important not to leave the details ignored.
We propose to develop a comprehensive political-economy model that captures the most important institutional aspects of Norwegian agricultural policy-making, thus allowing the simultaneous study of both the causes and consequences of Norwegian agricultural policies. The model will consist of a political part, capturing the political institutions shaping agricultural policies, and an economic par t based on the existing sector model Jordmod. The development of the political part will be based on interviews with key actors in the field. It also will require innovative research as most political models are based on pluralism, while corporatism pre vails in Norway. The model will provide insight into the conditions under which changes in the political institutions may be expected, and into the impacts those changes may have on the agricultural sector.