Summary: Soumaya Keynes (The Economist) and Chad P. Bown (Peterson Institute for International Economics) cohost a podcast about the economics of international trade and policy. From trade wars to trade deals, this podcast covers trade developments with insights and economic analysis from two of the world's top trade geeks.
Countries try to beat COVID-19 by limiting exports of medical supplies and cutting tariffs. Germany, France, South Korea and many more countries limit the exports of masks and protective gear for health workers, while the Trump administration quietly announces the exclusion of some medical products from its tariffs on China. Nadia Rocha (The World Bank) joins to discuss historical evidence on the “multiplier effect” of one country’s export restriction leading to another, and another… Read more… Soumaya Keynes. 2020. New trade barriers could hamper the supply of masks and medicines. The Economist, 11 March.Chad P. Bown. 2020. Trump’s trade policy is hampering the US fight against COVID-19. PIIE Trade and Investment Policy Watch, 13 March.Nadia Rocha, Paolo Giordani, Michele Ruta. 2016. Food prices and the multiplier effect of trade policy. Journal of International Economics.Nadia Rocha, Paolo Giordani, Michele Ruta. 2012. Export policy and food price escalation. VoxEU.org, 9 May.
Does globalization contribute to the gender wage gap? Beata Javorcik (Oxford University, EBRD) joins to explain one overlooked channel. She describes how job flexibility demands for companies that interact in foreign markets across multiple time zones penalize women. With evidence from Norway, they also discuss whether this is driven by perceptions in gender differences that might be overcome by policy change. Read more… Esther Ann Bøler, Beata Javorcik, Karen-Helene Ulltveit-Moe. 2018. “Working across Time Zones: Exporters and the Gender Wage Gap,” Journal of International Economics. Esther Ann Bøler, Beata Javorcik, Karen-Helene Ulltveit-Moe. 2015. ““Globalisation: A woman’s best friend? Not quite so.” VoxEU.org, 18 May. Chinhui Juhn, Gergely Ujhelyi and Carolina Villegas-Sanchez. 2013. “Trade Liberalization and Gender Inequality.” American Economic Review. Chinhui Juhn, Gergely Ujhelyi and Carolina Villegas-Sanchez. 2014. “Men, women and machines: How trade impacts gender inequality.” Journal of Development Economics.
Simon Rabinovitch (The Economist) joins from China to explain the economic, trade, and supply chains of the coronavirus disease. They discuss the origins of the COVID-19 outbreak, the Chinese government’s response, as well as initial implications for the Chinese people and economy. They then turn to global repercussions as well as potential disruption to trading partners’ economic activity arising through supply chains and other hidden channels. Read more… • Simon Rabinovitch. 2020. As its covid-19 epidemic slows, China tries to get back to work. The Economist, 25 February. • Simon Rabinovitch. 2020. How China’s coronavirus epidemic could hurt the world economy. The Economist, 15 February. • World Health Organization. 2020. Coronavirus disease (COVID-19) outbreak.
A Washington protest march and the economics of the wine industry illustrate the impact of US tariffs and tariff threats. The Trade Talks team reports from the ‘One America March;’ speaks to importers, distributors, and retailers; and explores the impact of the Trump administration’s tariffs on wine trade and small businesses in the industry. Read more… Soumaya Keynes. American drinkers of European wine face mounting tariff bills. The Economist, 13 February 2020. One America March, Washington, DC, February 9, 2020
The Napoleonic Blockade offered an opportunity for economists to see whether temporary protection from imports can help industrial development. Réka Juhász (Columbia University) joins to discuss her research into whether French regions better protected from trade with the British during the Napoleonic Wars (1803-1815) did better in mechanized cotton spinning – the era’s frontier industry – than more exposed regions. Read more… Réka Juhász. 2018. Temporary Protection and Technology Adoption: Evidence from the Napoleonic Blockade. American Economic Review.
What is the Glasgow effect? Richard Davies explains, and tells the gripping economic story of how shipbuilding drove the Scottish city’s boom and bust. Drawn from his new book Extreme Economies (Farrar, Straus and Giroux 2020), they begin by describing how the economic forces of Marshallian externalities led to the rise of Glaswegian shipbuilding on the River Clyde. They then turn to its tragic downfall, its economic and social policy failures, and the extremely low life expectancy plaguing Glasgow to this day.
Nick Bloom (Stanford University) joins to discuss the increase in trade policy uncertainty under President Trump and implications for investment and economic growth. They describe new ways of measuring policy uncertainty – including the Economic Policy Uncertainty Index, as well as surveys – and recent evidence of its impact, including on the US stock market. Read more… Scott Baker, Nicholas Bloom, and Steve Davis. 2016. Measuring Economic Policy Uncertainty, Quarterly Journal of Economics.Scott Baker, Nicholas Bloom, and Steve Davis. 2019. The extraordinary rise in trade policy uncertainty, VoxEU.org, September 19. Scott Baker, Nicholas Bloom, Steve Davis and Marco Sammon. 2019. What Triggers Stock Market Jumps? Stanford University manuscript.
Two former USTR negotiators join to explain the details of the new US-China trade agreement. Agriculture negotiator Darci Vetter (Edelman, 3:50) describes China’s new commitments toward US farm products, and foreign investment negotiator Lauren Mandell (WilmerHale, 18:30) explains changes to China’s legal system, protection of intellectual property, as well as the agreement’s dispute settlement provisions. Finally, we get the reaction of the business community (33:00) before Simon Rabinovitch (The Economist, 37:15) joins to provide the perspective from China. Episode Transcript [PDF] Read more… Soumaya Keynes. 2020. The new US-China trade deal marks an uneasy truce. The Economist, January 16. Soumaya Keynes. 2020. Free Exchange: The costs of America’s lurch towards managed trade. The Economist, January 25. Chad P. Bown. 2020. Unappreciated Hazards of the US-China Phase One Deal. PIIE Trade and Investment Policy Watch, January 21.Economic and Trade Agreement Between the Government of the United States and the Government of the People’s Republic of China. January 15, 2020.
New evidence reveals a side effect of President Trump’s import tariffs. The research shows that, through US supply chain linkages, the new US tariffs on imported inputs are directly contributing to the recent slowdown in US exports of outputs. Kyle Handley (University of Michigan) joins to discuss the potential causes and consequences of these results. Read more… Kyle Handley, Fariha Kamal and Ryan Monarch. 2020. Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism. NBER Working Paper No. 26611, January.
The WTO is failing to meet a 2020 deadline set by the UN’s Sustainable Development Goals to negotiate limits to fisheries subsidies. To figure out why, we went to Geneva and spoke with Alice Tipping (International Institute for Sustainable Development) and Mukesh Bhatnagar (Centre for WTO Studies). We describe difficulties on getting a deal to restrain subsidies which lead to overcapacity and overfishing, as well as eliminating subsidies that contribute to illegal, unreported and unregulated fishing. Read more… Basak Bayramoglu, Brian Copeland, Marco Fugazza, Jean-François Jacques. 2019. Trade and negotiations on fisheries subsidies. VoxEU.org, 21 October.FAO. 2018. The state of world fisheries and aquaculture 2018. Food and Agriculture Organizations of the United Nations, Rome.Marco Fugazza and Tansung Ok. 2019. Fish and fisheries products: From subsidies to non-tariff measures. UNCTAD Research Paper Series, UNCTAD, Geneva.Enric Sala, Juan Mayorg, Christopher Costello, David Kroodsma, Maria L. D. Palomares, Daniel Pauly, U. Rashid Sumaila, and Dirk Zeller. 2018. The economics of fishing the high seas. Science Advances.U. Rashid Sumail, Naazia Ebrahim, Anna Schuhbauer, DanielSkerritt, Yang Li, Hong Sik Kim, Tabitha Grace Mallory, Vicky W.L. Lam, Daniel Pauly, 2019. Updated estimates and analysis of global fisheries subsidies. Marine Policy 109: 103695.World Economic Forum. 2019. David Attenborough explains what we need to do to stop over-fishing. Youtube video, 8 October.
Republicans lost 40 seats in the 2018 elections for the US House of Representatives. Emily Blanchard (Tuck School of Business) joins to discuss new research that investigates how Trump’s trade war affected the 2018 election. The evidence suggests the combination of the trade war and attempts to repeal and replace the Affordable Care Act may have cost the Republicans as many as 15 House seats. Read more… Blanchard, Emily J., Chad P. Bown, and Davin Chor. 2019. Trump’s trade war cost Republicans congressional seats in the 2018 midterm elections. VoxEU.org, 26 November.Blanchard, Emily J., Chad P. Bown, and Davin Chor. 2019. Did Trump’s Trade War Impact the 2018 Election? Working Paper, November.
Trump’s US Trade Representative provides a fact sheet and more detail on the first stage of the deal announced December 13 to address the administration’s trade war with China. The fact sheet previews an eventual 86 page legal agreement that would include additional Chinese commitments on intellectual property rights protection, technology transfer, agriculture, financial services, currency, dispute resolution, and expanding trade. Bown and Keynes also discuss what the Trump administration has agreed to do with all of the new tariffs it has imposed on China, as well as what is not in the phase one deal. Read more… Soumaya Keynes. 2019. America and China reach a “phase one” trade deal. The Economist, 14 December.Chad P. Bown, 2019. Phase One China Deal: Steep Tariffs Are the New Normal. Peterson Institute for International Economics Trade and Investment Policy Watch Blog, 19 December.Chad P. Bown. 2019. US-China Trade War Tariffs: An Up-to-Date Chart. Peterson Institute for International Economics, 19 December.
USMCA gets one step closer after Congressional Democrats, organized labor, the Trump administration, and Mexico strike a deal. Megan Cassella (Politico, 2:18) explains how the four-way negotiations led to the December 10 announcement of additional tweaks to the new North American trade agreement, including on biologics. Simon Lester (Cato Institute, 14:13) and Kathleen Claussen (University of Miami, 20:00) also join to discuss changes to dispute settlement, and the enforcement of rules regarding labor. Read more… Soumaya Keynes. 2019. The revised USMCA pleases both Democrats and Donald Trump. The Economist, 12 December.
Government subsidies are a key battle area in today’s trade disputes between countries, including the US and China. But finding and measuring those subsidies is increasingly hard. Ken Ash uses the aluminum sector to describe the OECD’s new approach to tracking them down. He also previews a new OECD report on subsidies to semiconductors, and the role of government-sponsored equity injections. Read more… OECD. 2019. Measuring distortions in international markets: the aluminium value chain. OECD Trade Policy Papers, No. 218, OECD Publishing, Paris. http://dx.doi.org/10.1787/c82911ab-en
Stephen Vaughn, formerly the Trump administration’s USTR General Counsel, joins in a wide-ranging conversation about the Trump administration’s trade policy. They discuss critiques of the pre-Trump approach (3:04), as well as Trump’s approach on China (6:00), the European Union (18:30), the WTO Appellate Body (22:50), and more. Episode Transcript [PDF]