The Arable Crops Sector

image of The Arable Crops Sector

This study takes an in-depth look at the arable crops sector in OECD countries and draws some conclusions about the impacts of agricultural support policies, trade liberalisation, agri-environmental payments, and agri-ennvironmental regulations. It contains economic and structural data, agri-environmental indicators for the arable crops sector, and analysis of the policy measures supporting arable crops farming and addressing environmental issues both at the aggregate country level and regional levels. This is the third in a series of in-depth studies being undertaken by the OECD to investigate the linkages between agriculture, trade and the environment. The first study on the pig sector was published in 2003, and the second study on the dairy sector was published in 2004.

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An Analysis of the Trade Effects of Agri-Environmental Payments and Regulations on Arable Crops

The new and more comprehensive agri-environmental programmes discussed in Chapter 4 raise questions about the possible negative effects on trade, including arable crop imports and exports. It is theoretically sound and permissible under current trade rules to pursue such agri-environmental policy interventions (Anderson, 1992; Ervin, 1999). Indeed, correcting for missing environmental markets (i.e. positive and negative externalities and public goods) or reducing government policy distortions improves social welfare. However, the choice of approach adopted for making the corrections and reducing the distortions is critical. Agri-environmental programmes, if not designed and implemented in cost-effective ways, may lead to losses in national and/or global welfare. Hence, an examination of their effects on production and trade, and of ways to improve their efficacy is warranted...

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