A coupled-channel (CC) approach has been developed to investigate kaon photoproduction on the nucleon. In addition to direct K + Λ production, our CC approach accounts for strangeness production including K + Λ final state interactions with both π 0 p and π + n intermediate states. Calculations for the γp → K + Λ reaction have been performed, and compared with the recent data from SAPHIR, with emphasis on the CC effects. We show that the CC effects are significant at the level of inducing 20% changes on total cross sections; thereby, demonstrating the need to include πN channels to correctly describe the γp → K + Λ reaction.

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