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Trade Wars: Nobody Expects the Spanish Inquisition

Eddy Bekkers (), Joseph Francois and Hugo Rojas-Romagosa

Papers from World Trade Institute

Abstract: This paper assesses the utility of economic theory of rational trade wars to predict such events or to prescribe courses of action to control their consequences. Trade wars are fundamentally political events whose causes are almost completely political and whose consequences are to a significant degree also political. Contemporary economic theory has developed during a uniquely peaceful and liberal period in world history, affecting how economists have thought about trade conflicts, leaving the profession unprepared to provide serious analysis or advice.

Date: 2019-10-17
New Economics Papers: this item is included in nep-hpe, nep-int and nep-pol
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