GTAP Resources: Resource Display
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"A Hazard Model Approach to Dynamic TRQ Reallocation " Authors: Schaefer, Aleks, Mingcong Xie and Vincenzina Caputo Abstract Despite the prevalence of underfill in international tariff-rate quotas (TRQs), governments typically have strong incentives to administer quotas in ways that achieve full or near-full utilization. One mechanism for accomplishing this is the mid-year reallocation of quota shares when initial holders appear unlikely to fill their allocations. This paper develops an empirical framework for identifying when mid-year reallocation should occur and evaluates the market and welfare implications of more aggressive reallocation policies. Using monthly data from the U.S. raw sugar TRQ spanning 1996--2024, we estimate a Cox proportional hazards model that characterizes the evolving probability that a country-specific allocation ultimately remains underfilled. We then use the estimated hazard structure to simulate counterfactual reallocation regimes in which USDA reallocates unused quota when predicted underfill probabilities rise above a threshold. Embedding the resulting import paths in an equilibrium displacement model of the U.S. sugar market, we quantify how alternative trigger thresholds and reallocation fill efficiencies affect prices, trade flows, and welfare. Across a broad range of policy parameters, we find that more aggressive trigger-based reallocation does not necessarily increase imports. Positive welfare gains require both sufficiently stringent triggers and high fill efficiency among recipient countries. |
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- Agricultural policies - Dynamic modeling - Econometric methods - North America |
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Public Access  Paper (1.3 MB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 4/30/2026 12:56:16 PM
