Reorienting budgetary support to agriculture for climate change mitigation


by smalhotra | January 16, 2024

Using economic modelling, the OECD assessed a number of agricultural support repurposing scenario to compare their impacts on greenhouse gas (GHG) emissions from agriculture in its recent policy paper - Reorienting Budgetary Support to Agriculture for Climate Change Mitigation: A Modelling Analysis.

Key takeaways from this policy paper are:

  • Reducing support to the sector could reduce emissions, but not as much as reorienting agricultural support plus incentivizing specific agri-environmental practices.
  • Some payments to farmers are likely more climate-harmful than others – support based on output, on variable inputs such as fuel or fertilizers, on number of animals – and reforming those is more efficient.
  • Investing in research and innovation for more efficient production is among the least-cost options for climate mitigation in the long-term.
  • Supporting adoption by farmers of abatement technologies is also an efficient investment path for reorienting agricultural support for climate.
  • If all these measures were combined and applied across the OECD, global agriculture emissions could be reduced by 5% at low cost and without adverse food security impacts; if other countries would follow, global reduction in emissions would more than double at 11%.

Read the full policy paper here.