Impacts of agricultural subsidy reform on economic welfare, environment and health

Agricultural subsidies are prevalent in nearly all countries across the globe. The main objective of subsidies is to ensure plentiful food production, and to guarantee basic income to farmers. In most countries this is achieved by raising the long-term level of prices above free-market levels and/or by providing direct payments to farmers. Agricultural subsidies mainly help to influence the cost and supply of commodities such as wheat, feed grains, livestock, milk, rice, sugar, and oilseeds such as soybeans. However, they have been criticised for their potentially adverse effects on (i) economic welfare, (ii) the environment and (iii) health. In this study we quantify the economic, environmental and health impacts of agricultural subsidies and analyse what consequences a phasing out or re-purposing of those subsidies could have.