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International Trade and Worker Displacement: Evaluation of the Trade Adjustment Assistance Program

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  • Paul T. Decker
  • Walter Corson

Abstract

The Trade Adjustment Assistance (TAA) program offers unemployment compensation and re-employment adjustment services to workers who lose their jobs due to increased import competition. In 1981 and again in 1988, the program rules were changed to shift the emphasis from compensation to training. This paper examines the pre-layoff characteristics and post-layoff labor market experience of two nationally representative samples of TAA program participants, one of which participated in the program just before the 1988 amendments and the other just after. The authors find that the TAA program was well targeted during the time period studied: it served workers who were permanently displaced from their jobs and who experienced significant earnings losses due to their layoff. They find no evidence, however, tha training had a substantial positive impact on earnings of TAA trainees, at least in the first three years after their initial unemployment insurance claim.

Suggested Citation

  • Paul T. Decker & Walter Corson, 1995. "International Trade and Worker Displacement: Evaluation of the Trade Adjustment Assistance Program," ILR Review, Cornell University, ILR School, vol. 48(4), pages 758-774, July.
    • Handle: RePEc:sae:ilrrev:v:48:y:1995:i:4:p:758-774
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    Cited by:

    1. LE Marcal, 2001. "Does Trade Adjustment Assistance Help Trade‐Displaced Workers?," Contemporary Economic Policy, Western Economic Association International, vol. 19(1), pages 59-72, January.
    2. Steven J. Matusz & David G. Tarr, 2017. "Adjusting To Trade Policy Reform," World Scientific Book Chapters, in: Trade Policies for Development and Transition, chapter 4, pages 77-114, World Scientific Publishing Co. Pte. Ltd..
    3. Kletzer, Lori, 2003. "Trade-related Job Loss and Wage Insurance: A Synthetic Review," Santa Cruz Center for International Economics, Working Paper Series qt27w182ht, Center for International Economics, UC Santa Cruz.
    4. James N. Giordano, 2017. "Job Training Subsidies, Reemployment and Earnings in the Trade Adjustment Assistance Program," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 23(3), pages 283-293, August.
    5. Fackler, Daniel & Stegmaier, Jens & Weigt, Eva, 2019. "Does extended unemployment benefit duration ameliorate the negative employment effects of job loss?," Labour Economics, Elsevier, vol. 59(C), pages 123-138.
    6. Cletus C. Coughlin, 2002. "The controversy over free trade: the gap between economists and the general public," Review, Federal Reserve Bank of St. Louis, vol. 84(Jan.), pages 1-22.
    7. Kletzer, Lori, 2003. "Trade-related Job Loss and Wage Insurance: A Synthetic Review," Santa Cruz Department of Economics, Working Paper Series qt27w182ht, Department of Economics, UC Santa Cruz.
    8. Yolanda Kodrzycki, 1997. "Training programs for displaced workers: what do they accomplish?," New England Economic Review, Federal Reserve Bank of Boston, issue May, pages 39-57.
    9. Park, Jooyoun & Reynolds, C.L. & Rohlin, Shawn M., 2014. "The impact of import-related displacement on local business activity," Regional Science and Urban Economics, Elsevier, vol. 48(C), pages 94-109.

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