Question

In: Economics

Describe trade adjustment assistance and discuss why it is controversial.

Describe trade adjustment assistance and discuss why it is controversial.

Solutions

Expert Solution

Answer :-

Trade Adjustment Assistance is basically a program that offers assistance to workers in manufacturing who lose their jobs because of import competition.

For the income support provided under the trade adjustment assistance program, state governments pay the income support at the level given by that under unemployment insurance.

Trade Adjustment Assistance,

  • Provides transfer payments to domestic workers who have lost their jobs due to trade.
  • It is infrequently used today due to the large budgetary cost of some programs.
  • Provides funds for worker re-training programs.

It is found that, trade adjustment assistance for workers become low effective which causes a controversy to reauthorization of the program.

The program is not very effective which can provide support because some portion of the workers does not receive TRA during transition.

Another reason is that the training enrollment deadline of 8/16 weeks seriously limits the ability of workers to enroll in training programs and receive the benefit.


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