Recipient Organization
LOUISIANA STATE UNIVERSITY
202 HIMES HALL
BATON ROUGE,LA 70803-0100
Performing Department
Agri Economics & Agribusiness
Non Technical Summary
U.S. Agriculture is dependent on the International Market. The U.S. has long been a proponent of developing opportunities for trade through multilateral, bilateral, and regional trade agreements. Recent events, however, including the U.S. withdrawal from Trans-Pacific Partnership (TPP) negotiations and the announced renegotiation of the North American Free Trade Agreement (NAFTA) create uncertainties with respect to their implications for U.S. agriculture. The U.S. decision to withdraw from the Paris Accord creates uncertainties on the environmental front that will affect U.S. agricultural trade, both with respect to the reaction of countries that are markets for U.S. agricultural products as well as our ability to compete through the elimination or reduction of environmental regulations. While the U.S. Secretary of the Treasury has been directed to label China a currency manipulator, the tremendous economic growth in the United States only adds to U.S. purchasing power and exacerbates the Chinese trade surplus with the United States. At the same time, the Secretary of Commerce and the U.S. Trade Representative have been directed to identify all foreign trading abuses that unfairly affect American workers and use every tool under American and international law to end those abuses immediately, which will potentially result in retaliation.Although there is much evidence of a change in the stance of the U.S. with respect to international trade, it is important to note that the global market is changing as well. Evidence of this can be seen with Brexit, as Great Britain's vote to secede from the European Union will create the need for renegotiation and modification of numerous trade agreements involving Britain and the EU. Both countries will be forced to develop or renegotiate pacts with the United States as well as with our competitors and customers.The problem that comes to the fore is that it is often unclear what the implications of these actions will be for agriculture and related interest groups. During the period of 2006-2016, U.S. agricultural exports rose from $70.95 billion to $134.71 billion a 90 percent increase. Imports rose from $65.46 billion to $114.44 billion, resulting in a positive agricultural trade balance that nearly quadrupled from $5.49 billion in 2006 to $20.27 billion in 2016 (ERS and FAS, 2018). Given the importance and growth of international agricultural trade for U.S. agriculture and the U.S. economy, there is a need to determine the specific consequences for agricultural trade of these actions mentioned above. These implications include trade creation and trade diversion impacts, as well as price, quantity, and welfare implications for various interest groups, including agricultural producers, agribusiness, consumers, and the environment.The body of work proposed here will contribute to the understanding of agricultural trade and policy. As a group of researchers from multiple institutions, the output of this work will address the multifarious needs of the agricultural community and policy makers. As these constituencies are interested in a diverse group of products and policies both nationally and internationally, the collaboration of this project will address many of these different interests. The analysis will advance the science of economics of trade and policy in agriculture with new empirical techniques and new data.The outcomes of this research are expected to have positive consequences for numerous stakeholders associated with the U.S. food and agricultural sector. This includes agricultural producers, consumers, agribusiness firms, rural communities, policy makers, farm organizations and related constituencies in order for them to have the information necessary for informed decision making and policy design.
Animal Health Component
100%
Research Effort Categories
Basic
(N/A)
Applied
100%
Developmental
(N/A)
Goals / Objectives
1. Determine the impacts of U.S. and foreign policies, regulations, market structures, and productivity on U.S. food and agricultural trade, the economy, and the environment. Specifically, to examine the impact of the following a. foreign investment and multinational firms,
b. international and national events and policies (e.g., Farm Bill, immigration and labor issues, food fraud, food labeling laws), and
c. economic growth and changing policies of developing and emerging economies, including safeguards or other mechanisms that target food security.
Determine the impacts of international trade agreements and institutions on U.S. food and agricultural trade, the economy, and the environment.ÿ Specifically, to examine the potential implications of the following: a. renegotiating preferential trade agreements (e.g., NAFTA),
b. not engaging in preferential trade agreements (e.g. Trans Pacific Partnership), and
c. future preferential trade agreements.
Project Methods
Methods to accomplish the objectives of this project include econometrics, simulation, spatial and optimization models, and time series analysis. Market behavior, supply and demand along with risk and uncertainty will be studied using these methods. The economic impacts will focus on changes in output, value added, employment, the welfare of consumers and producers, and government expenditures. Measures of economic performance will focus on prices, trade, economies at the regional and national level, and the environment. In addition, we will develop new methods and extend existing methods to accomplish these objectives.