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141. Will Europe Fall into a Japanese-Style Stagnation Trap?

Author:
Peter Harrold
Publication Date:
04-2012
Content Type:
Policy Brief
Institution:
Center for Social and Economic Research - CASE
Abstract:
Can Europe avoid falling in to a Japanese-style stagnation trap? In this type of trap, we see a repeated cycle of a financial crisis leading to a fiscal crisis, leading to a decline in consumer and investor confidence, and a resulting fall in demand. The decline in growth that inevitably follows simply causes the cycle to repeat itself. In theory, this should lead to improved competitiveness, but in Japan the forces of decline outweighed any boost in export demand. This E-brief is based on Peter Harrold’s presentation at the CASE 2011 International Conference on "Europe 2000: Exploring the Future of European Integration" held on November 18-19, 2011.
Topic:
Financial Crisis, Crisis Management, Economic Policy, Exports, Macroeconomics, and Strategic Competition
Political Geography:
Japan, Europe, and Asia

142. Asian Alliances in the 21st Century

Author:
Dan Blumenthal
Publication Date:
08-2011
Content Type:
Working Paper
Institution:
Project 2049 Institute
Abstract:
Washington’s policy since the Nixon administration has been to welcome China into the international system. Beijing has accepted the invitation but, unfortunately, has also chosen to engage in a military competition with the United States that is undermining the post-World War II system from which China itself has greatly benefited. Competition need not lead to conflict. There are alternative futures that Washington has the power and influence to create for its own and its allies’ common interests. Washington’s greatest advantage is a set of highly capable allies. Now is the time to help these alliances become greater than the sum of their parts.
Topic:
International Relations, Alliance, Strategic Competition, and International System
Political Geography:
Asia

143. The Growth of Chinese Exports: An Examination of the Detailed Trade Data

Author:
Brett Berger and Robert F Martin
Publication Date:
11-2011
Content Type:
Working Paper
Institution:
Board of Governors of the Federal Reserve System
Abstract:
Over the past decade, Chinese exports have boomed, increasing far faster than GDP growth. What can account for this explosion? Our paper uses finely detailed Chinese export data (8-digit HS codes) combined with U.S. trade data to explore this question. Although exchange rate policy clearly boosted the trade surplus, and the structure of the economy, e.g. abundant cheap labor, encouraged investment, these alone cannot account for the changing composition and acceleration of exports. We find that the growth in exports is most likely a product of effective Chinese industrial policy and fortuitous timing. The detailed trade data reveal that key “new” technology goods, such as cell phones, LCD screens, and laptops played a critical role. Finally, we use the data to examine the relationship between Chinese exports and global manufacturing, in particular U.S. manufacturing employment. We find that increased Chinese competition in both domestic and U.S. export markets likely lowered U.S. manufacturing employment between 2000 and 2007. Chinese policy is not, however, wholly responsible. Some job losses, such as in textile production, were no doubt the result of China’s natural comparative advantages, while other U.S. job losses are attributable to relatively low investment and slow GDP growth in the United States following the 2001 recession.
Topic:
International Trade and Finance, Hegemony, Exports, Trade, and Strategic Competition
Political Geography:
China and Asia