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The Trade Adjustment Assistance (TAA) Program for Farmers in the U.S.: Role of Incentives in Program Participation

Yu Na Lee (), Nancy Chau () and David Just

No 176205, 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota from Agricultural and Applied Economics Association

Abstract: The Trade Adjustment Assistance (TAA) program for farmers was established in 2002 to assist farmers adversely affected by import surges. Since its introduction, the program has been mostly underused by farmers, and the American Recovery and Reinvestment Act (ARRA) in 2009 eased the program rules to encourage more farmers to participate. Why has farmers’ participation in the program been so low? Have the relaxed criteria of the ARRA been effective in encouraging farmers’ participation? Based on a simple decision-making model and a uniquely constructed panel data set, we find that farmers’ incentive to make up for losses in other types of direct government payments as well as eligibility criteria explain farmers’ participation in the TAA program. Less time and efforts needed for participation, proxied by previously approved cases of the same or similar commodities, also seems to drive farmers’ participation. Results also confirm that the ARRA of 2009 was effective in increasing farmers’ participation.

Keywords: Trade Adjustment Assistance; TAA; American Recovery and Reinvestment Act; ARRA; Incentives; Participation; Agricultural and Food Policy; International Relations/Trade; D81; F13; F68; Q17; Q18 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr
Date: 2014-07
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