American Economic Review: Insights
ISSN 2640-205X (Print) | ISSN 2640-2068 (Online)
The US-China Trade War and Global Reallocations
American Economic Review: Insights
vol. 6,
no. 2, June 2024
(pp. 295–312)
Abstract
The US-China trade war created net export opportunities rather than simply shifting trade across destinations. Many "bystander" countries grew their exports of taxed products into the rest of the world (excluding the United States and China). Country-specific components of tariff elasticities, rather than specialization patterns, drove large cross-country variation in export growth of tariff-exposed products. The elasticities of exports to US-Chinese tariffs identify whether a country's exports complement or substitute the United States or China and its supply curve's slope. Countries that operate along downward-sloping supplies whose exports substitute (complement) the United States and China are among the larger (smaller) beneficiaries of the trade war.Citation
Fajgelbaum, Pablo, Pinelopi Goldberg, Patrick Kennedy, Amit Khandelwal, and Daria Taglioni. 2024. "The US-China Trade War and Global Reallocations." American Economic Review: Insights, 6 (2): 295–312. DOI: 10.1257/aeri.20230094Additional Materials
JEL Classification
- F13 Trade Policy; International Trade Organizations
- F14 Empirical Studies of Trade
- O19 International Linkages to Development; Role of International Organizations
- P33 Socialist Institutions and Their Transitions: International Trade, Finance, Investment, Relations, and Aid