Are the agricultural policy reforms embodied in the Uruguay Round consisten
t with meeting domestic policy objectives such as providing adequate food s
ecurity, environmental protection and viability of rural areas? This articl
e examines the claim that agriculture deserves more price support and impor
t protection than other sectors because of the non-marketed externalities a
nd public goods it produces jointly with marketable food and fibre (agricul
ture's so-called 'multifunctionality'). Do these unrewarded positive extern
alities exceed the negative externalities from fanning by more than the net
positive externalities produced by other sectors? To what extent are those
farmer-produced spillovers under-supplied, and what are the most efficient
ways to boost their production to the socially optimal levels? The article
concludes that there is little trade-off required to meet domestic policy
objectives on the one hand and agricultural protection reform objectives as
embodied in WTO rules on the other.