For a New Classification System of Domestic Support in the WTO Agreement on Agriculture

The Uruguay Round Agreement on Agriculture classifies domestic support to agriculture into three 'boxes': Amber, Blue, and Green. This legal distinction fails to smartly manage the trade-off between policy space to pursue domestic non-trade objectives and limiting trade distortions. The weak link between the box structure and economic analysis accentuates mercantilist bargaining and sends wrong signals to policy makers and domestic constituents. A more nuanced classification framework should be developed that is responsive to the degree of legitimacy different subsidies enjoy.