U.s. Corn Subsidy Policy Impact Analysis

Agriculture is the key problem for a country's long-run coordinated development and the fluctuation of the price of the agricultural products in short-run period is critical for the economic steadiness. The agriculture protection and agricultural products trade control has a long history for every country in this world. This paper investigates the effect of US corn subsidy policy to the corn price and production to analyses how the developed countries' agriculture subsidy protect and develop their agriculture. Meanwhile owning to the less developed situation of agriculture in our country and the more and more important role we play in word market, analyzing the US corn subsidy policy is important to develop our own agricultural policy.Looking back to the history of US agricultural policy, we can find their agriculture protection measure is decoupling with the specific agricultural price, while through a more detailed investigation to US corn subsidy after 2002, we find that the distortion of US corn subsidy to world corn price remains, but taking the form of environment-protecting and technology-assisting measures. Furthermore, because of the pricing right of US in world corn market, its corn subsidy will increase the corn supply in world market, and pull down the corn price, in this process the other corn export countries suffer economic loss, therefore international trade conflicts are caused. Thus investigating how the US corn subsidy distorts international trade will be helpful for us to protect ourselves by using WTO negotiation procedure.This paper is made up of five chapters, the first chapter introduced the research background and the basic research ideas, consolidated the relevant literature and demonstrated the innovation and lack of my study; chapter two reviewed the related theory; chapter three summarized the change of US corn subsidy policies, and analyzed why the policy change a lot after 1980's, a more detailed investigation revealed that not only the sales and production of corn are affected by subsidy policy, the development of the whole country area is also related with the subsidy policy; chapter four analyzed how the US corn subsidy affected its domestic corn production and price; the last chapter summered the previous study and conclude.