Paper Summary:

Agricultural subsidies are a form of protectionism for the industry by the government. This paper examines subsidies and their effects on worldwide productivity. The main points covered include poverty in undeveloped countries, the stance of the World Trade Organization (WTO) and International Monetary Fund (IMF) and some discussion on implementation.

From the Paper:

"Agricultural subsidies are a form of protectionism for the industry by the government. The World Trade Organization (WTO) commenced addressing this in its DOHA Round but prior to that it was on the agenda for the General Agreement on Tariffs and Trade (GATT). Agriculture has typically been given higher tariffs than other manufactured goods or services. This means consumers pay higher prices than needed for imported agricultural products thereby reducing their ability to purchase other goods and services. (Hill, 2009, p.228). The WTO points to the benefit of removing tariff barriers and subsidies is to boost worldwide trade levels, lower consumer prices and increasing economic growth globally since funds could then be used for investment in additional productive resources and other consumption needs. (Hill, 2009, p.228)"

Sample of Sources Used:

• Agricultural Subsidies, Ploughing On: The Rich World's Farmers are Still Reaping Handsome Subsidies, The Economist, July 1, 2010 retrieved on November 04, 2010 from http://www.economist.com/node/16507149
• Hill, Charles W. L. (2009). International Business: Competing in the Global Marketplace 7th Edition. New York: McGraw-Hill/Irwin.
• Ingco, Merlinda D. and Nash, John D. (2004). Agriculture and the WTO: Creating A Trading System for Development. Washington:World Bank and Oxford University Press.
• Lattimore, Ralph and Love, Patrick. (2009). International Trade: Free, Fair and Open? OECD Insights series, 2009, pp 71-74.
• Luciani, Patrick. (2004). Economic Myths: Making Sense of Canadian Policy Issues 4th Edition. Toronto: Pearson Education Canada Inc.

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