EFFECTIVENESS OF AGRICULTURAL SUPPORTS ACROSS OECD AND SELECTED COUNTRIES UNDER THE WTO SPELL

Abstract

Agricultural supports are among the most favored policies of governments to affect domestic welfare and maintain food security. Supports provided take many forms ranging from those distorting prices and production to de-coupled ones with no link to production. In addition to budgetary or climatic restrictions, countries also face challenges due to the terms of the WTO about types of supports. In line with the WTO mandates, this study analyses the impact of supports by excluding market price supports, that are the biggest parts of distorting supports. Using the OECD and FAO databases, it is shown that there is a discrepancy between crops and animal products with respect to the impact of supports with no significant impact noted for animal products. It is also considered that analyses conducted with different types of supports and products could create a solid basis for suggesting counter arguments against the WTO mandates.

Keywords

• agricultural support
• producer single commodity transfe
• most distorting supports
• arellano-bond gmm estimation