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 and so forth. Policies that vary from region to region are needed to reflect different regional needs, encouraging farmers to adopt practices that are ecologically sustainable in their own areas.

49. The importance of regional policy differentiation can be easily illustrated:
 * Hill areas may require incentive prices for fruits and subsidized supplies of foodgrains to induce farmers to shift towards horticulture, which may be ecologically more sustainable.
 * In areas prone to wind and water erosion, public intervention through subsidies and other measures should encourage farmers to conserve soil and water.
 * Farmers on land over recharge areas for underground aquifers subject to nitrate pollution might be given incentives to maintain soil fertility and increase productivity by means other than nitrate fertilizers.

50. The third defect in government intervention lies in incentive structures. In industrialized countries, overprotection of farmers and overproduction represent the accumulated result of tax reliefs, direct subsidies, and price controls. Such policies are now studded with contradictions that encourage the degradation of the agricultural resource base and, in the long run, do more harm than good to the agricultural industry. Some governments now recognize this and are making efforts to change the focus of the subsidies from production growth to conservation.

51. On the other hand. in most developing countries the incentive structure is weak. Market interventions are often ineffective for lack of a organizational structure for /…