The US trade dispute: blunt offense or rational strategy?

Michael Hübler and Axel Herdecke

Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät

Abstract: This article evaluates the recent protectionist US trade policy and the retaliation of the EU and China. The article employs a New Quantitative Trade Theory model and an Armington model for comparison. The simulation results show that US car tariffs are a credible threat to the EU, but the steel and aluminum tariffs are not. China suffers considerably from the US tariffs, especially the extended, tightened tariffs that have been announced. The retaliation measures of the EU and China, however, do not cause US welfare losses compared to the situation without such a trade policy.

Keywords: Trade policy; trade war; numerical model; USA; EU; China (search for similar items in EconPapers)
JEL-codes: F11 F17 F42 (search for similar items in EconPapers)
Pages: 8 pages
Date: 2019-01
New Economics Papers: this item is included in nep-cmp and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: The US trade dispute: blunt offense or rational strategy? (2020)
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