Many of the countries with strong export growth were operating along downward sloping supply curves and selling products that substituted for those previously supplied by the US or China. The researchers find that the winners and losers in the trade war are explained primarily by heterogeneity in exporters’ responses to trade-war-induced price changes, rather than by specialization patterns. Because of this response from the rest of the world, on net, they calculate that the trade war raised global trade by 3 percent. These nations did more than reallocate global trade flows across destinations their overall exports to the world increased. The researchers further find that trade in the products targeted by the tariffs increased among bystander countries. China’s exports to the US declined by 8.5 percent and its exports to the rest of the world rose by a statistically insignificant 5.5 percent. US exports to China fell by 26.3 percent while exports to the rest of the world increased modestly, by 2.2 percent. The US and China reduced exports of products subject to increased tariffs. Their analysis compares the export growth across products that were subject to different tariff increases by the US or China. ![]() To analyze the impact of these four sets of tariff changes on global trade, the researchers match the tariffs’ movements to global bilateral trade data from the International Trade Centre for the top 50 exporting countries, excluding oil exporters. ![]() The tariff increases were a major departure from long-run trends towards tariff liberalization across the globe. At the same time, it also lowered tariffs on imports from the rest of the world. China retaliated and imposed tariffs on imports from the US. It also raised tariffs on a subset of products from other countries, mainly in machinery and metals. In 20, the US raised tariffs on imports from China. While the US and China largely taxed each other and depressed their bilateral trade flows, bystander countries increased their exports to the US and the rest of the world and global trade increased overall. ![]() Export growth was stronger, on average, in countries with larger shares of their exports governed by strong trade agreements, and in countries with more foreign direct investment. Kennedy, Amit Khandelwal, and Daria Taglioni find that the trade war created trade opportunities for other nations and increased overall global trade by 3 percent. In The US-China Trade War and Global Reallocations (NBER Working Paper 29562), Pablo Fajgelbaum, Pinelopi K. These tariff increases reduced trade between the US and China, but little is known about how trade was affected in the rest of the world. U pendin g a decades-long effort to reduce global trade barriers, China and the United States began mutually escalating tariffs on $450 billion in trade flows in 20. Transportation Economics in the 21st Century.Training Program in Aging and Health Economics.The Roybal Center for Behavior Change in Health.Retirement and Disability Research Center.Measuring the Clinical and Economic Outcomes Associated with Delivery Systems.Improving Health Outcomes for an Aging Population.Early Indicators of Later Work Levels, Disease and Death.Conference on Research in Income and Wealth. ![]()
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