In this chapter, policies that have supported agriculture since the 1950s are reviewed for the United States, the European Union, Canada, and China. Overall, policies have evolved slowly and imperfectly to reduce the economic inefficiencies associated with farm programs, although not necessarily the size of income transfers. In the United States, the direction of movement has been toward replacing crop-specific subsidies tied to production with ones that provide income support and target volatility but are less distorting to production and trade. The European Union has moved from price interventions to whole farm payments, while levels of support have remained substantial. Canada has policies for grains and oilseeds, but with less support provided, while retaining supply-restricting quotas and high domestic prices for dairy, eggs, and poultry. China has been pressured to move in the reform direction after raising its support levels. Insurance and other business risk management assistance programs, also relatively non-distorting, have emerged as key components of farm support in the United States, Canada, and China, but not the European Union.
JEL classifications: F55, N52, N54, N55, O13, Q17, Q18