Seminario "The Return to Protectionism" Pablo D. Fajgelbaum
Miércoles 28 de agosto, 17h | Sala principal
Abstract
We analyze the impacts of the 2018 trade war on the U.S. economy. We estimate import demand and export supply elasticities using changes in U.S. and retaliatory taris over time. Imports from targeted countries declined 31.5% within products, while targeted U.S. exports fell 11.0%. We find complete pass-through of U.S. taris to variety-level import prices. Using a general equilibrium framework that matches these elasticities, we compute the aggregate and regional impacts. Annual consumer and producer losses from higher costs of imports were $68.8 billion (0.37% of GDP). After accounting for higher tari revenue and gains to domestic producers from higher prices, the aggregate welfare loss was $7.8 billion (0.04% of GDP). U.S. taris favored sectors located in politically competitive counties, but retaliatory taris oset the benefits to these counties. We find that tradeable-sector workers in heavily Republican counties were the most negatively aected by the trade war.
Pablo D. Fajgelbaum
Ph.D. in Economics, Princeton University.
Associate Professor of Economics, UCLA.
Research Associate, NBER
We analyze the impacts of the 2018 trade war on the U.S. economy. We estimate import demand and export supply elasticities using changes in U.S. and retaliatory taris over time. Imports from targeted countries declined 31.5% within products, while targeted U.S. exports fell 11.0%. We find complete pass-through of U.S. taris to variety-level import prices. Using a general equilibrium framework that matches these elasticities, we compute the aggregate and regional impacts. Annual consumer and producer losses from higher costs of imports were $68.8 billion (0.37% of GDP). After accounting for higher tari revenue and gains to domestic producers from higher prices, the aggregate welfare loss was $7.8 billion (0.04% of GDP). U.S. taris favored sectors located in politically competitive counties, but retaliatory taris oset the benefits to these counties. We find that tradeable-sector workers in heavily Republican counties were the most negatively aected by the trade war.
Pablo D. Fajgelbaum
Ph.D. in Economics, Princeton University.
Associate Professor of Economics, UCLA.
Research Associate, NBER