Reform price-distorting regulations that increase agricultural emissions

Agriculture is a heavily protected sector, with budgetary transfers of USD 447 billion and a further USD 272 billion paid by consumers in higher prices per year in 2018-20. Measures that raise prices can take, for example, the form of quantitative import restrictions, tariff rate quotas and tariffs, to keep cheaper foreign products out of the market, or production quotas that limit domestic production.

These policies, along with payments linked to production and to unlimited use of fertilisers or fuel, should be overhauled as they help drive up emissions from farming, by encouraging overproduction and more intense agriculture. They also lock producers into certain products, stifling innovation and adaptation to climate change.

EXPLORE FURTHER

Report: Agricultural Policy Monitoring and Evaluation, OECD (2022)

Paper: A survey of GHG mitigation policies for the agriculture, forestry and other land use sector (2020)

Paper: Evaluating the Environmental Impact of Agricultural Policies, OECD (2019)