ABSTRACT
The term decoupling has become a part of the language in farm policy debates and the General Agreement on Tariffs and Trade (GATT) negotiations. As such, decoupling is a two-step process. The first step is the elimination of all farm programs that act by altering a farmer's production decisions relative to a free market. Current farm programs seek to increase farm income by raising market prices (via price supports and supply control) and by subsidizing the prices received by farmers. The environmental problems of current farm policies are caused by the tendency of particular programs to encourage increased rates of application of fertilizers, insecticides, and herbicides; increased conversion of highly erodible soils or wetlands. Many effects of decoupling arise from shifts in the absolute and relative price levels of farm commodities. A multilateral move toward agricultural trade liberalization would moderate many of the effects on U.S. agriculture of a unilateral U.S. move.
