| 초록 |
This study estimates the degree of decoupling of the direct payments program newly introduced for Korea's rice industry under uncertainty to see how the program is linked to rice production. Risk-averse producer is assumed to maximize certainty equivalent profit under price and quantity uncertainties. The degrees of decoupling are estimated for CARA (constant absolute risk aversion) and DARA (decreasing absolute risk aversion) cases by conducting ex ante simulations. The result shows that there is high possibility that current direct payments program has substantial effects on rice production due to variable direct payment, not meeting the Green Box requirement of the Agreement on Agriculture. For the current direct payments program to be in full harmony with the Green Box criteria, it would be necessary to replace the variable direct payment with fixed one in the long run.
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