S1062: The importance of U.S. food and agricultural trade in a new global market environment

(Multistate Research Project)

Status: Inactive/Terminating

S1062: The importance of U.S. food and agricultural trade in a new global market environment

Duration: 10/01/2013 to 09/30/2018

Administrative Advisor(s):

NIFA Reps:

Statement of Issues and Justification

A. Changes in domestic agricultural and economic policies; regulations and market developments; along with structural changes in production and marketing are major factors influencing the international competitiveness of the U.S. food and agricultural sector (1 see below) . Evidence of structural change comes from a doubling of the prices for corn, soybeans and wheat starting in 2006. The last time prices doubled was 1973-74. The higher prices were driven by rapid increases in ethanol production and the associated derived demand for corn. Exports were also a factor in structural changes due to a continuing devaluation of the dollar. In recent years one cannot ignore the emergence of China as an economic juggernaut with a middle class exceeding the entire population of the United States. The demand for food, protein, feed grains and other agricultural products is already reaching significantly into the U.S.

Over the period of 2007-2012, U.S. agricultural exports rose from $82.2 billion to $135.8 billion  a 65 percent increase. Imports rose from $70.1 billion to $103.4 billion resulting in a positive agricultural trade balance going from $12.2 billion to $32.4 billion  a 166 percent increase (ERS and FAS, 2013).

The principal benefits of this research includes information pertaining to trade creation and diversion, supply response, import demand, land values, price variability, agricultural value added, food safety, the environment, and emerging bio-energy issues. Improved competitiveness of the U.S. in international food and agricultural trade is expected to strengthen the employment base and increase income levels in respective states.

Research conducted within the proposed project will primarily address SAAESD Priority Area Goal 1, AN AGRICULTURAL SYSTEM THAT IS HIGHLY COMPETITIVE IN THE GLOBAL ECONOMY. Research will specifically address needs pertaining to sub-goals: G. Competitiveness in international markets and J. Public policy & economics of agricultural production systems.

B. The proposed elements of the new 2013 Farm Bill if adopted will result in a major shift in U.S. agricultural policy from the 2008 legislation. The shift from traditional price based income supports to a risk management based income safety net and elimination of direct payments promise to have a pronounced impact on government outlays in support of production agriculture. A continuation of the trend in government support for food and nutrition programs, food safety related issues, and stimulus for local markets can be expected. The rapid rise in the biofuels industry; the rising demand abroad driven by income growth and dietary changes; the financial crisis; and two commodity price spikes in the last five years have also changed the policy environment for the next decade. The price outlook for many commodities is for relatively high and volatile prices such as we have experienced in recent years.

How these changes will affect the structure, conduct and performance of U.S. agriculture are yet to be determined. Changes in policies and developments in major export markets will lead to increased market opportunities. With these changing conditions, the objectives of this research focus on the emerging issues and opportunities associated with agricultural trade and the global market environment during the next decade.

If this type of analysis does not go forward, stakeholders will not be aware of the economic impacts of changes in agricultural trade and the global market environment. While various commodity groups may have researchers who investigate their specific commodities and the related policies, the proposed work in this multi-state project will bring together a team of researchers to assess trade and policies across multiple commodities and products.

D. Multi-state Collaboration: The list of policy and trade issues available for research is a long one. Only with multistate collaboration can the researchers select a relevant subset that focuses on the most current, critical issues. In so doing the analysis provides results that transcend state lines. In addition, individual researchers will apply different methods and models to a selected trade or policy issue. The collective results will give a perspective that addresses the multi-dimensional aspects of an issue.

E. 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.

F. The outcomes of this research are expected to have positive consequences for several 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.

(1) For the purpose of this proposal we define competitiveness as the capacity of U.S. producers and agribusinesses to profitably maintain and grow agricultural exports and find new markets for U.S. food and agricultural goods.

Related, Current and Previous Work

Previous research of S-1043 (and previous incarnations of the multi-state group) focused mainly on policy of the last decade such as decoupled payments and existing trade arrangements. The members of the S-1043 project have conducted collaborative research related to numerous commodities and issues of importance to Southern agriculture. For example, the group has completed research on the impacts of bio-energy alternatives on Southern agriculture. Applied research has also focused on the economic impacts of selected invasive species on critical production regions within the South, including zebra-chip and citrus-greening. The group has also provided economic analysis on immigration reform alternatives to state and national policy-makers. An applied research effort has also focused on agricultural market potential in Cuba, with results presented to industry and policy-makers. The group has conducted various trade policy simulations to determine the impacts of alternative international trade agreements for commodities including sugar, cotton, peanuts, beef, pork, wheat, and soybeans. At the Southern Agricultural Economics Association, S-1043 presented papers on logistics and trade as well as price volatility. The group has written public policy information leaflets to be disseminated to national policy-makers prior to finalizing the 2008 Farm Bill. In the fall of 2012, S-1043 members contributed to the development of conference Emerging Issues in Global Animal Product Trade co-sponsored by the Farm Foundation, the Economic Research Service, NFP, and Texas Tech University's Combest Endowed Chair for Agricultural Competitiveness. In the areas of risk management, and monetary and fiscal policies, the group has applied econometric and simulations tools to determine the short and long-run effects of exchange rate uncertainty on agricultural input prices. The group has also conducted studies on exchange rate effects on trade and international marketing. Furthermore, the group has also made significant efforts in research that focus on structural changes in global markets development. Specifically, studies on the structural changes in Chinese oil seeds and grains markets that are of significant importance to U.S. exports have been conducted by the group.

S-1043 has also provided economic analyses on the effects of phytosanitary protocols on U.S. trade with Asia; and U.S. food safety standards and export competitiveness in Asia-Pacific Countries. At the global meat trade meeting, the S-1043 members contributed several of the papers presented that dealt with country- of-origin labeling (COOL) and food safety and quality issues. The members of the S-1043 group have contributed to the relatively small literature that focuses on the inter-relationships between agricultural trade and the environment (surface water and groundwater pollution).

S-1043 members have also engaged in research efforts that provide economic analysis to major WTO rulings. Impact assessment has been conducted regarding the U.S. proposal and other countries proposals on competitiveness of the U.S. rice industry proposed in the Doha Round of the WTO negotiations. The group has also determined the economic impacts of agricultural labor shortages on horticulture, dairy and beef production. Additional factors examined include intellectual property rights provisions; WTO rulings and the alignment of domestic policies with those rulings; sanitary and phytosanitary regulations; and critical infrastructure responses and new security regulations. In addition, S-1043 has developed an analytical framework to estimate the qualitative impacts of freer trade that was likely to result from the implemented negotiations in the World Trade Organization (WTO) and Free Trade of the Americas (FTAA). Finally, studies on foreign agricultural products entering into U.S. after WTO accession have conducted by the S-1043 group.

In addition, the group has worked on modeling and simulation of the impact of WTO related provisions on the Cotton/Textile/Apparel complex, undervalued currencies, agricultural labor shortages, and invasive species. As was the case previously, while a significant amount of work has been done to show the impact of these factors on the agricultural sector, much remains to be done to show the overall impact of these institutions and their actions on the broader economy and the environment.

Previous literature

A review of the general trade literature indicates that a large amount of research has been and is being done in the area of international trade, although the volume devoted to agricultural trade is considerably smaller than for industrial and other trade issues. The body of work of greatest relevance to this proposal is summarized briefly by major topics. Trade agreement work is relatively vast, but, since 2005, representative work as it relates to agricultural trade includes the following: Bureau and Salvatici (2005), Devadoss (2006), Abler (2007), Gervais, et al (2008), Grant and Lambert (2008), Zhuang et al (2008), Anderson (2010), Ghazalian and Cardwell (2010), Jean et al (2010), Sun and Reed (2010), Grant and Boys (2012), Meyers, et al. (2010), and Zhuang, et al. (2008).

The effect of trade and trade liberalization is another major research area, and publications on this topic include, among others: Awokuse (2007), Brockmeier and Pelikan (2008), Femenia and Gohin (2011, 2009), Hendricks and Nalley (2008), Knutson, et al. (2010), Martin and Anderson (2008), McCorriston and MacLaren (2010), Nuetah et al. (2011), Serrano and Pinilla (2010), Tamini et al. (2012, 2010), Telleria, et al (2008), Thompson et al. (2010), Tokarick (2008), and Verma et al. (2011). Specifically agricultural trade with China is an area of great concern as noted by Awokuse and Yin (2010), Chen, et al. (2012), Mulik and Koo (2011), Peng, et al. (2005), Song, et al. (2009), and Tuan, et al. (2010).

Some typical policy studies include the following: Awokuse and Wang (2009), Bekkerman, et al. (2012), Chung, et al. (2009), Cooper (2010, 2009, 2009), Feng and Hart (2010), Goodwin (2008, 2009), Goodwin, et al. (2011) Goodwin and Rejesus (2008), Harwood (2009), Mukherjee, et al. (2013), Paulson and Babcock (2008), Paulson and Schnitkey (2012),Petrolia and Ibendahl (2008), Schmitz et al. (2009), Serra, et al.(2011), Ubilava, et al. (2011), and Zulauf and Orden (2010).

Economists have conducted a number of studies to explain the devleopment and success of the GATT and the current challenges of the WTO and the failure of the Doha Development Agenda (Bagwell and Staiger, 2010, Bagwell and Staiger, 1999, Bagwell and Staiger, 2012, Bagwell and Staiger, 2004, Chisik, 2012).

Macroeconomic policy, while very important in general and manufacturing international trade, appears to have received relatively little attention in agricultural trade literature. The studies in this area examine the impacts of monetary and exchange rate adjustments on international trade. Some examples of this work include Baek and Koo (2009, 2007, 2011, 2008, 2010), Bamba, et al. (2008), Ge, et al. (2010), Goswami and Nag (2012), Huchet-Bourdon and Cheptea (2011), Koo and Zhuang (2007), Miljkovic and Paul (2008), Orden (2010), and Zhuang, et al. (2008).

A growing area of research involves the inter-relationships between trade and the environment, although there are relatively few specific references to agricultural trade and the environment. Much of this literature assesses the effects of trade liberalization on agriculture production and consumption and the resulting effect on the environment (Fooks, et al. (Forthcoming), Johansson, et al. (2006), Johansson, et al. (2005), Kastner, et al. (2011), Larson and Scatasta (2005), Saunders, et al. (2006), Savard (2003), Verburg, et al. (2008), Wurtenberger, et al. (2006), and Zilberman and Rajagopal (2007)).

Research conducted in the area of bioenergy/biofuel economics includes work that investigate land use changes, food-versus-fuel debate and policies such as the renewable fuel standard and crop subsidies like the following (Hertel and Beckman (2010), Hertel, et al. (2008), Keeney and Hertel (2008), Khanna, et al. (2010), Lasco and Khanna (2010), Lee and Sumner (2010), Liu, et al. (2012), McDonald, et al. (2006), Meyer, et al. (2012), Meyer and Thompson (2010), Motaal (2008), Schmitz, et al. (2011), Senauer (2008), Sheldon and Roberts (2008), Switzer (2012), Thompson (2010), Thompson, et al. (2011), Zhuang, et al. (2007), and Zilberman and Rajagopal (2007)).

The food-versus-fuel debate has centered on food price volatility. Several papers have looked at these issues in light of international trade such as: (Alghalith (2010), Apergis and Rezitis (2011), Jin and Kim (2012), McPhail, et al. (2012), Qiu, et al. (2012), Serra, et al. (2011), Shepherd and Wilson (2013), Thompson, et al. (2012), Wilson (2012), and Yeboah, et al. (2012)).

However, Barrett and Bellemare (2011) and Gouel (2013) suggest that volatility may not matter to poor consumers though high prices are important and farmers care about low prices and perhaps volatility. Furthermore, the price volatility seen in the recent past could be the result of a number of other mitigating factors such as declining rates of agricultural productivity, trade policies and storage (Martin and Anderson, 2012, Wright, 2011). Additionally, Giordani, et al. (2012) find evidence of a complementarity between export policies and food prices in international markets such that export restrictions increase food price volatility.

A growing body of literature at the agriculture and trade nexus has the gravity model as the method of choice. This literature tends to evaluate non-tariff measures and trade agreements for example, (Cipollina and Salvatici (2010), Cissokho, et al. (2013), Disdier, et al. (2008), Disdier and Marette (2010), Drogue and DeMaria (2012), Grant (2013), Grant and Boys (2012), Grant and Lambert (2008), Haq, et al. (2013), Karemera, et al. (2011), Karemera, et al. (2009), Lambert and McKoy (2009), Li and Beghin (2012), Olper and Raimondi (2008), Raimondi and Olper (2011), Saitone (2012), Shepherd and Wilson (2013), Tamini, et al. (2010), Tran, et al. (2012), Vigani, et al. (2012), Wieck, et al. (2012), and Winchester (2012)). Beghin (2013) covers many of these topics with the gravity model and other approaches.

Several articles in the gravity model literature build upon the work of Melitz (2003) and Helpman, et al. (2008), which looks at the decision of firms to export. The literature has been spawned an extensive literature.

The extant literature explores agricultural trade and how policy changes such as domestic food safety or macroeconomic policies affect the flow of goods and the welfare effects of these policies. This literature is international though often with consideration of the effects of trade on U.S. agriculture. This literature has been supported by members of the S-1043.

Related projects

Currently only one multistate project is related to the international trade aspects of the proposed work: W2004 Marketing, Trade and Management of Aquaculture and Fishery Resources states that it will address trade issues of fishery products, but the connection to trade is a small part of the larger body of work of that project. In terms of agricultural policy, SERA035 Delta Region Farm Management and Agricultural Policy Working Group is working on how farm policies influences the management of select agricultural producers in the Delta and surrounding regions. SERA039 Public Policy Issues Education is focused on outreach efforts related to public policies of agriculture. W2190 Water Policy and Management Challenges in the West is a group that researches and communicates findings on Western water issues. While these projects touch on issues of international trade or policy, none weave these issues together and considers the diversity of products and constituencies as proposed in this project.


  1. Determine the impacts of U.S. and foreign policies, market structures, and regulations on U.S. food and agricultural trade, the economy, and the environment.
  2. Determine the impacts of international arrangements and institutions on U.S. food and agricultural trade, the economy, and the environment.


Methods to accomplish these objectives 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. Objective 1: Determine the impacts of U.S. and foreign policies, market structures, and regulations on U.S. food and agricultural trade, the economy, and the environment. Global market developments along with structural changes in those markets and policy evolution directly affect U.S. agricultural trade and the environment. Structural changes are occurring in markets important to the U.S. due to income growth, urbanization, changes in demographics, and in the environment. For example, China as the number one importer of U.S. agricultural products is going through major structural change. Since 2012, more than half of its population lives in urban areas with 75% of its population projected to be urban by 2050. Income growth is expected to continue at a rate of 7% annually, and its demographic structure is projected to change dramatically due to the aging of its population and its current one-family-one-child policy. These changes will affect U.S. agriculture in unknown ways given the current state of knowledge. Other countries such as the Ukraine and Russia are undergoing significant structural change in the organization of their agricultural production. Already, these countries have become major exporters of wheat, and they could become large exporters of other commodities as they further develop their agricultural production techniques and management skills. Recent failures in agricultural productivity in Africa and the growth in the size of their middle class indicates future increase in the demand for agricultural and food imports from the U.S. and other net agricultural exporting nations. Developments in China, Russia, and other parts of the world such as Africa and South America make it imperative that future research focus on these issues. However, the traditional trade partners like Canada, Mexico and Japan are still important trade partners. Therefore, future work must consider these countries. For Objective 1, Procedures 1A and 1B, individual researchers will focus appropriate methods on a selected trade or policy issue. In keeping with multistate collaboration, the issues were specifically selected by the committee because they represent the current state of affairs. The collective results will address the multi-dimensional aspects of international trade. The meta-themes of this goal include understanding the effects on agricultural trade of macroeconomics policies, the role of transportation and logistics, and domestic and foreign policies and standards (e.g. biofuels, biotechnology, country of origin labeling, health and safety, environmental, etc.). Individually and collectively the team will generate research to address these issues across multiple commodities and policies. Procedure 1.A: U.S. and Foreign Policies The team of researchers will develop models to evaluate the effects of macroeconomics conditions in the U.S. and other nations on U.S. agricultural exports (Alabama, Delaware, Louisiana, and North Dakota). In particular this work will build on the gravity and other trade models to explore these relationships. This work will focus on bulk commodities such as corn, livestock, poultry, soybeans, wheat, etc. Additional work will focus on consumer-ready processed food products. The team will investigate the impact of exchange rates both from the perspective of achieving agreements and their impact on the competiveness of agriculture particularly in the Southern U.S. within the context of free trade agreements. Exchange rates can have a significant influence on international flow of agricultural policies. The team has researchers who will analyze the effect of exchange fluctuations and their effect on agriculture (Alabama, Louisiana, and South Carolina). Team members will use time-series econometrics to investigate the short- and long-term effects of exchange rates on U.S. trade in agricultural products. Methodologically, meta-analytical work will evaluate the effect size of exchange rates on agriculture and non-agricultural products. The team has researchers assessing the impact of domestic policies and policies of other countries (e.g., Panama Canal Expansion) on infrastructure related to our intermodal transportation system, specifically those components related to agricultural trade (Louisiana). Another researcher will assess the impact of transportation infrastructure on state agricultural exports using a spatial panel model. The improvement of infrastructure in a specific state or region on state agricultural exports will be simulated (Tennessee). In terms of biofuels, the team has a number of projects under consideration (Missouri, Nebraska, and Tennessee). The project will continue to make state level estimates of the growing capacity and production of ethanol; the attendant requirements of corn as a feedstock; and the production of distillers grain as a co-product. State-level estimates will be made for corn and distillers grain supply and utilization which provides useful information to stakeholders interested in the feed grain-livestock economy. They will also serve as input data to formal economic models used to evaluate the impacts of various policies, regulations, market developments and structural changes on the domestic and international disposition of corn and distillers grain (Nebraska). A researcher will apply the POLYSYS model to evaluate the impact of adopting the biofuel mandate in the Renewable Fuel Standard (RFS) on land uses, prices and exports of crops (Tennessee). The effects of biofuel policy changes on the net returns of crop producers will also be simulated (Missouri and Tennessee). The complex interdependence of fuel, food and feed markets will be analyzed in a partial equilibrium, multimarket model (Missouri). A researcher will apply a geospatial optimization model to estimate the impact of establishing a regional cellulosic biofuel industry on land use change among crops. The environmental effects of the biomass feedstock supply chain will be estimated (Tennessee). A team of researchers is proposing more fundamental research on the effect of change in consumer preferences on international trade, with a particular interest in Chinese demand (Florida). Another team of researchers will use Data Envelopment Analysis (DEA) to measure productivity increase and environmental damages resulting from the trade agreements and treaties (North Carolina). Additional work will explore the effects productivity growth in key regions such as Russia, the Ukraine and Kazakhstan for U.S. agricultural exports (Florida and Missouri). While another group of researchers propose to explore supply response models to measure the effects of production risk in U.S. grain and oilseeds (North Carolina). Procedure 1.B: Regulations This section will focus on tariffs, food safety, sanitary and phytosanitary regulations, biotechnology, climate change, environmental regulations, animal welfare, and country of origin labeling. While countries may impose tariffs and quotas, digital trade (trade through Internet commerce between countries) on the whole bypasses these restrictions and lessens the impact of trade regulations. For example, Chinese mothers who do not want to buy their domestically produced baby food products are buying American baby foods through Internet and American contacts. Therefore the team proposes a project to consider the alternative trade markets (Iowa). Beyond tariffs most of the regulations under consideration are often categorized as non-tariff measures (barriers) and can have substantial effects on production cost and ultimately affect trade flows. The team of economists will investigate the effects of country of origin labeling (COOL) on changes in market structure in U.S. meat products with a source-differentiated Almost Ideal Demand System Models (AIDS), and equilibrium displacement models will be developed to determine the changes in consumers surplus resulting from COOL (North Carolina). Another researcher proposes a multi-country investigation of the trade impacts of intellectual property rights protection and the growth of agricultural biotechnology. The proposed study will be based on panel data estimation approaches in modeling the impact of patent rights, a form of non-tariff trade barriers (Delaware). The team proposes to assess barriers to acceptance and use of genetically modified (GM) rice. One researcher will coordinate a multi-country study looking at regulatory barriers, attitudes of producers and consumers, and social media. The proposed study will use experimental auctions, contingent valuation, and global modeling of impacts of acceptance/refusal commercialization of GM rice (Arkansas). One of the team members will investigate the effects of food safety and quality standards and the trade of fish and other seafood products. Additionally, this researcher will explore the political economy underpinnings of the rise of food and agriculture standards from the European Union (Alabama). Researchers will expand current work on how environment causality effects trade with a focus on agricultural exports (South Carolina). Though not assigned to any research or team of researchers, the group will consider the multifarious factors that have led to the food price increases and the associated increase in volatility. In particular, the team will consider the effects of trade policies on price levels and volatility. Also the team will consider firm-level analysis á la Helpman, et al. (2008) and Melitz (2003) to understand better the effects of policies especially non-tariff measures at the firm level. Objective 2: Determine the impacts of international arrangements and institutions on U.S. food and agricultural trade, the economy, and the environment. International institutions such as the World Trade Organization (WTO), World Bank and International Monetary Fund (IMF) are still significant players in international trade. Keeping up with changes in these institutions is vital to the movement of international trade. However, because of the inability of the WTO to move their agenda forward, we will focus on regional trade agreements (RTA) and free trade agreements (FTA). Trade agreements considered included NAFTA, APEC, DR-CAFTA, and the EU. Past work also examined the interface between regional free trade agreements and domestic policy and sought to examine bilateral trade between the United States and China. While a significant amount of work has been conducted examining the impact of regional and bilateral trade agreements on agricultural trade, much work remains to be done to show the impact of these agreements on other sectors of the economy and the economy as a whole. The impacts of new trade agreements, such as the recently signed FTAs with Columbia and Korea and the potential Trans-Pacific Partnership (TPP), U.S-EU Transatlantic Trade and Investment Partnership, remain to be considered. The project will also consider other agreements that do not include the U.S. such as COMESA and MERCOSUR that may affect U.S. trade relationships. In addition, it is important to determine the impact of existing and new trade agreements on the environment. Procedure 2.A: Impact of international arrangements (Regional and Bilateral Trade Agreements) Several researchers propose to use computable general equilibrium (CGE) models, equilibrium displacement models, gravity models, global spatial equilibrium, and import demand models to assess the impacts of bilateral and regional free trade agreements on agricultural products (corn, dairy, meat, peanuts, rice, seafood, soybeans, sugar, tomatoes, tree nuts, wheat, watermelon, inter alia) relevant to their respective states. This work will assess the impacts of existing major and minor FTAs (ASEAN, COMESA, DR-CAFTA, ECOWAS, EU, MERCOSUR, NAFTA), proposed FTAs such as the US-EU Transatlantic Trade and Investment Partnership (TTIP), the Trans-Pacific Partnership Agreement (TPP), and bilateral agreements of the U.S. to Colombia, Cuba, Korea, and other countries as they arise. These models will evaluate trade creation and trade diversion and trade expansion attributable to the FTAs. Additionally, these trade models will assess bilateral and global trade, price, production, and consumption effects (Alabama, Arkansas, Colorado, Delaware, Florida, Louisiana, Missouri, North Carolina, North Dakota, South Carolina, and Virginia). The team will use econometric models that focus on the estimation of the elasticity of substitution among imports from different countries to evaluate the normative impacts of these bilateral trade agreements (North Carolina). The researchers propose to evaluate the impact of the regional and bilateral trade agreements, particularly those in the Western Hemisphere, on infrastructure related to our intermodal transportation system, specifically those components related to agricultural trade (Louisiana). The team will use the GTAP model, a general equilibrium model, to assess the trade and welfare effects of a free trade agreement between NAFTA and EU countries. Consideration will be given to the effects of tariff and non-tariff measure reductions and eliminations (Colorado). A number of researchers in the group use the gravity model. These researchers will explore modifications to the model and new specifications including generalized and specific gravity models, models with a power transformation (Alabama, North Carolina, North Dakota, South Carolina, and Virginia. Additionally, the team of researchers will investigate new methods to deal with zero trade and non-tariff measures. Procedure 2.B: Impact of international institutions (WTO, IMF, World Bank) The team will examine the interface between regional free trade agreements and domestic policy, focusing on how these agreements might constrain U.S. policy in the future (North Carolina). In particular, one group of researchers will assess the economic impacts of the new suspension agreement on trade of tomatoes (Florida). Researchers propose to assess the impact of the WTO, other international institutions, and potential future agreements on infrastructure related to our intermodal transportation system, specifically those components related to agricultural trade (Louisiana). More generally, the team of researcher will assess the impact of the WTO on the expansion of trade (Virginia). The team of researchers will use general equilibrium models to determine the impact of preferential trade agreements, currency unions, and border effects resulting from WTO rulings (North Carolina).

Measurement of Progress and Results


  • Journal Articles
  • Books and Book Chapters
  • Professional Papers
  • Conference Organized

Outcomes or Projected Impacts

  • Better ability to understand and predict changes resulting from changes in trade agreements.
  • Better ability to understand and predict changes resulting from changes in domestic policy.
  • More clientele exposure to trade research and information.


(2014): 2013-2018 - Organize and conduct organized symposia and invited paper sessions at regional, national, and international professional meetings and other fora to extend the applied research results obtained within this regional research project.

(2015): Organize and conduct a major conference outlining the changes occurring in trade agreements and their effects on U.S. agriculture.

(2016): Conduct a regional workshop related to emerging issues in trade agreements and their effects on important clientele groups and commodities in the United States. Proceedings from this conference will be disseminated as a web-based regional experiment station bulletin.

Projected Participation

View Appendix E: Participation

Outreach Plan

Information will be made available to users through refereed and non-refereed articles, technical publications, as well as through organized symposia and selected papers at professional meetings, and books. In addition, the committee regularly sponsors, participates in, and/or organizes major regional and national conferences with both web access to proceedings and popular press coverage.


The Regional Technical Committee organization and functioning follow that suggested in the Manual for Cooperative Regional Research, pages 18-22 (1992). The membership includes the regional administrative advisor (non-voting); a National Institute of Food and Agriculture(NIFA) representative (non-voting); and a technical representative from each participating agricultural experiment station appointed by the Director.

Other agencies and institutions may participate at the invitation of the Administrative Advisor. More than one representative of a participating agricultural experiment station, agency, research group or institution may serve on the technical committee and serve as officers of the committee. However, each agricultural experiment station, agency, research group or institution is limited to one vote regardless of the number of participants.

All members of the Technical Committee are eligible for office, regardless of the sponsoring agency affiliation. This organization is as follows:

Officers: The chairperson is elected by the voting members to a two-year term and may be re-elected for additional terms of office. The chairperson, in consultation with the administrative advisor, notifies the technical committee members of the time and place of meetings, prepares the agenda, and presides at meetings of the technical committee and executive committee. He or she is responsible for preparing the annual report of the regional project. The existing S-1043 chairperson will serve as the chair of the new committee for a one-year term (through Fall 2014). At that time, a new chairperson for the new committee will be elected for a two-year term.

Secretary: The secretary records the minutes and performs other duties assigned by the technical committee or the administrative advisor. He or she is elected by the voting members to a two-year term and may be reelected for additional terms of office. The existing S-1043 secretary will serve as the secretary of the new committee for a one-year term (through Fall 2014). At that time, a new secretary for the new committee will be elected for a two-year term.

Subcommittees: The Project has an executive committee that is designated to conduct the business of the committee between meetings and perform other duties as assigned by the technical committee. It consists of the Project chairperson, secretary, and two other members of the committee. These two members are elected by the voting members of the technical committee to two-year terms and may be reelected for additional terms of office. They serve staggered terms with one member being elected each Fall. One of these members will serve as the liaison between this Project and the Southern Extension Policy and Trade Committee. Other subcommittees are named by the chairperson as needed for specific assignments such as developing procedures, planning conferences, and preparing publications.

Literature Cited

Abler, D. 2007. "Approaches to Measuring the Effects of Trade Agreements." Journal of International Agricultural Trade and Development 3(2):155-171.
Alghalith, M. 2010. "The Interaction between Food Prices and Oil Prices." Energy Economics 32(6):1520-1522.

Anderson, K., ed. 2010. The Political Economy of Agricultural Price Distortions. Cambridge and New York: Cambridge University Press.

Apergis, N., and A. Rezitis. 2011. "Food Price Volatility and Macroeconomic Factors: Evidence from GARCH and GARCH-X Estimates." Journal of Agricultural and Applied Economics 43(1):95-110.

Awokuse, T.O. 2007. "Market Reforms, Spatial Price Dynamics, and China's Rice Market Integration: A Causal Analysis with Directed Acyclic Graphs." Journal of Agricultural and Resource Economics 32(1):58-76.

Awokuse, T.O., and X. Wang. 2009. "Threshold Effects and Asymmetric Price Adjustments in U.S. Dairy Markets." Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie 57(2):269-286.

Awokuse, T.O., and H. Yin. 2010. "Does Stronger Intellectual Property Rights Protection Induce More Bilateral Trade? Evidence from Chinas Imports." World Development 38(8):1094-1104.

Baek, J., and W.W. Koo. 2009. "Assessing the Exchange Rate Sensitivity of U.S. Bilateral Agricultural Trade." Canadian Journal of Agricultural Economics 57(2):187-203.

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