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My Policies or Yours: Does OECD Support for Agriculture Increase Poverty in Developing Countries?

My Policies or Yours: Does OECD Support for Agriculture Increase Poverty in Developing Countries?

Chapter:
(p.183) 5 My Policies or Yours: Does OECD Support for Agriculture Increase Poverty in Developing Countries?
Source:
Globalization and Poverty
Author(s):
Margaret McMillanAlix Peterson ZwaneNava Ashraf
Publisher:
University of Chicago Press
DOI:10.7208/chicago/9780226318004.003.0006

This chapter employs cross-country data to measure the impact of Organization for Economic Cooperation and Development (OECD) support policies for agriculture on poverty. The poorest countries are net exporters of all agricultural products. Depressed prices for food products may hurt middle-income countries but help the poorest and richest developing countries. There is no evidence in the regression analysis that OECD policies help or hurt the poor. It appears unlikely that U.S. corn subsidies are driving poverty in Mexico unless one takes the stand that U.S. corn farmers as an interest group were largely responsible for the North American Free Trade Agreement (NAFTA). The majority of the poorest corn farmers did not sell corn in the market prior to NAFTA. Although the price of corn is no longer directly supported by the Mexican government, transfer payments to corn farmers at all levels of income increased substantially between 1991 and 2000.

Keywords:   agriculture, poverty, Organization for Economic Cooperation and Development, support policies, poorest countries, U.S., Mexico, corn

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