The key economic and market developments which provide the framework for the implementation of agricultural policies and related support to farming sector are analysed in the first part of this chapter. Highlights are then presented of the main recent changes and new initiatives in agricultural policies in 2011-12 in OECD countries. Finally, the developments in the estimated support (using the OECD PSE methodology) are evaluated in terms of its level, composition and changes over time in OECD countries.

This chapter includes a discussion of how policy makers in OECD countries and emerging economies can pursue the global challenge of improving productivity growth sustainability by improving innovation systems and agricultural policies. Developments in agricultural productivity growth and resource use are first presented to outline the issue. The different ways innovation systems, agricultural policy, farm structure and other factors affect agricultural productivity and sustainability are then discussed. Suggestions are made to strengthen innovation systems, and to improve agricultural policies, in order to foster agricultural productivity growth efficiently and sustainably. The need to improve policy coherence is stressed in the conclusion.