State-level equity and the demise of the agreement on textiles and clothing

Abstract

As of January 1, 2005 all quantitative restrictions on textile and apparel commodities were removed in accordance with the Agreement on Textiles and Clothing (ATC). This paper examines the economic impacts of the liberalization at the U.S. state level. The methodology utilizes a regional model of the U.S. economy built up from individually consistent IMPLAN social accounts for each state. The model incorporates forward-looking dynamic responses and equilibrium unemployment. The results are useful in quantifying the geographic distribution of the benefits and costs of the ATC’s expiration on the U.S. economy.