The Polluter-Pays Principle in the Context of Agriculture and the Environment

• Published in: World economy Vol. 19; no. 1; pp. 63 - 87
• Main Authors: Tobey, James A., Smets, Henri
• Format: Journal Article
• Language: English
• Published: Oxford, UK Blackwell Publishing Ltd 01.01.1996; Basil Blackwell for the Trade Policy Research Centre, etc
• Subjects: Agricultural economics; Agricultural production; Agricultural subsidies; Agriculture; Costs; Economic models; Environmental Policy; Environmental protection; Industrialized nations; International Relations; International trade; Nonpoint source pollution; Polluter-pays principle; Pollution; Pollution control; Studies; Subsidies
• ISSN: 0378-5920; 1467-9701
• DOI: 10.1111/j.1467-9701.1996.tb00664.x

The Polluter-Pays Principle (PPP) is examined with a focus on its consequences for the agriculture sector, trade and international relations. It is found that the application of the PPP to agriculture is not straightforward. Complexities of managing nonpoint pollution sources, and institutional arrangements that in industrial countries endow agricultural producers with wide-ranging rights to pollute, complicate the application of the PPP to agriculture. As a result, the level of cost internalization in agricultural sectors of most industrial countries is still insignificant, and the use of environmental subsidy schemes to reduce agricultural nonpoint source pollution is widespread and growing. Against this background , there is real concern that recent progress in reducing agricultural subsidies in industrial countries will be lost as production-oriented subsidies are replaced by new disguised production-enhancing support in the form of green payments.