The socio-economic development of rural areas has become an important issue for agricultural policy design in many OECD countries. Yet there is still a lack of comprehensive analysis of the inter-linkages between the agro-food sector and the rural economy. What consequences have on-going structural changes in agriculture for rural areas? What is the role of agricultural policies? The report, comprising a main report and case studies on Canada, France, Greece, Japan, New Zealand, Norway and Switzerland, addresses these important questions.

A key conclusion of the report is that traditional agricultural support policies are increasingly ineffective in accomplishing rural development objectives. Agricultural policy reform can enhance agro-food's contribution to the viable development of rural economies, although the benefits are not immediate. A coherent, well co-ordinated and targeted policy approach aimed at diversification, promotion of high-quality regional products, provision of information, direct payments and public goods would improve the competitiveness of rural areas. How to strike the right balance between the need for greater economic efficiency, and social and environmental concerns in rural areas is a key challenge facing policy makers.