If a country’s agricultural policy is biased toward promoting the export of crops in which the country has a comparative advantage, the international competitiveness of its agriculture will be disproportionately strengthened, and the trading result will be different from what it should have been. To test this hypothesis, this study performed a dynamic panel analysis using the System Generalized Method of Moments （S-GMM）. Empirical results show that the export promotion policies of competitive countries increase significantly the revealed comparative advantage indexes. This implies that domestic policies exempted from the reduction commitments under the WTO Agreement on Agricultural may be serving as hidden export subsidies. At the same time with the existence of such a policy bias, this study suggests the validity of the principle of comparative advantage.
