The Achievements and Limitations of the Public-purpose Direct Payment Program in Korea

Abstract

In the past, the direct payment program in the agricultural sector predominantly focused on rice, raising concerns about fairness in relation to other crops, excessive rice production, and limitations in terms of enhancing public functions. To tackle these concerns, the Korean government undertook a reorganization of the direct payment program in 2020. This reorganization brought about a substantial increase in the overall amount of direct payment, while also promoting equity among farm households through the introduction of direct payments specifically aimed at small farmers, among other measures. Although the reform of the direct payment program for public interest has generally been acknowledged as successful, it is believed that expanding the optional direct payment program would be a more effective approach to further enhance the value of public interest, which constituted the primary objective of the reform. By expanding the optional direct payment program, greater strides can be made towards achieving the desired improvement in public-purpose value.