This paper investigates how CAP investment subsidies influence agricultural productivity in Greece using time-series data from 2000 to 2023. The analysis focuses on whether subsidies intended to stimulate investment in agricultural infrastructure and technology have a tangible effect on productivity. Employing econometric methods such as the Vector Autoregressive Model (VAR) and Granger causality testing, this study explores the short- and long-term impacts of these subsidies. Findings suggest that CAP subsidies have a significant and positive influence on agricultural productivity, with more notable effects in regions that have adopted technological advancements. These results provide valuable insights for policymakers looking to optimise CAP reforms and ensure sustainable agricultural growth in Greece.

This paper aims to analyze the impact of fixed capital, variable inputs and labor and their interaction to the volume of the agricultural output in Greece, for the period 1981 - 2021, using the estimation equation of a Cobb-Douglas equation form. At a second level, an attempt is made to investigate possible changes in this relationship over time, using the Bai-Perron structural changes method and their effect on the observed relationship between agricultural inputs and output. The existence of a structural break in 2006 was confirmed, which is accompanied by differences in elasticities before and after this year. During the period 1981-2005, positive elasticities of labor and fixed capital were observed, indicating that the increase in these factors contributed positively to agricultural production, but with decreased returns to scale. In contrast, after 2006, negative elasticity of labor and fixed capital was detected, while the elasticity of variable factors of production remained positive. This change in elasticities indicates the inefficiency in the use of fixed capital and labor after 2006 and the increased influence of variable production factors on agricultural production. These findings highlight the need for continuous monitoring and analysis of factors affecting agricultural production, in order to enhance the competitiveness of the corresponding sector and ensure its sustainability in the future, offering new perspectives for the design and implementation of policies that will enhance agricultural development. JEL classification: O130, Q100, R150

This study examines the impact of fixed capital, variable inputs, and labor on agricultural output in Greece from 1981 to 2021 using a Cobb-Douglas equation. It also investigates changes over time through the Bai-Perron structural changes method, confirming a structural break in 2006. From 1981 to 2005, labor and fixed capital had positive elasticities, contributing positively to agricultural production but with decreasing returns to scale. Post-2006, labor and fixed capital exhibited negative elasticities, indicating inefficiencies, while variable inputs retained positive elasticity. This shift suggests an increased influence of variable inputs on production after 2006. The findings highlight the need for continuous monitoring and analysis of agricultural factors to enhance sector competitiveness and sustainability, providing insights for policy design and implementation aimed at agricultural development.