Abstract Aim The thesis focuses on the agricultural policies of the European Union (EU) and the United States (US) in an effort to show how the respective policies differ or are similar and to what extent. The position of this thesis on the EU and the US, particularly in the light of the political implications on policy-making in the Agricultural Sectors is that both the EU’s Common Agricultural Policy (CAP) and the US’ Farm Bills need some internal adjustments to adapt them to meet the demands of the 21 st century’s agricultural environment. Methodology To come up with a working conclusion of the policy under study, the thesis uses the existing body of literature as the methodology to outline the CAP and the US’ Farm Bills. This thesis compares policies in the European Union (EU) and the United States (US). Justification of comparing US and EU The two economic and political unions are nearly each other’s most loyal clients and rivals simultaneously. Therefore, they form a good combination for this study because of their obvious incompatibilities or differences in policies. The inference is derived from the understanding of how these different and rival blocs manage to trade so well with each other. Findings Both the EU and the US are guilty of using state intervention to protect farmers’ interests in the light of international competition. State intervention takes various forms including service provision, which features the provision of certain ‘public’ goods and services primarily by the state. An example of such a public good is the reserved agricultural products such as those used to produce bio fuels. Intervention can also take the form of regulation whereby a state or government establishes and / or develops property rights to set up policies that discourage free market policies. The third variety of intervention takes the form of taxation, which usually targets investors who seek ventures aimed at compensating bearers or who produce negative externalities. There are both theoretical and practical controversies concerning state intervention (particularly that which counter ‘free market’ regulatory policies) as the answer to managing market failure. Conclusion The research findings are best explained by the moderate theory of public choice, which posits that the cost of state intervention far supersedes the costs created by market failure. Market failure is the primary justification for state intervention. In other words, each time federal or state governments interfere with the market they cite market failure as the reason for such usually – more – costly society measures applied to regulate the market. Proponents of the public choice theory posit that state intervention measures mostly end up draining taxpayers’ resources for the benefit of a few special interest groups, culminating in political instability, which in turn breeds socio-economic malfunctioning. Introduction Context and Background to the Study This study hinges on two critical concepts. They include the General Agreement on Tariff and Trade (GATT) agreement and the rounds of negotiations that eventually culminated in the creation of the World Trade Organisation (WTO), which institutionalised world trade and provided a forum for renegotiations concerning multilateral trade agreements among member st