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2. Tariffs and Monetary Policy: A Toxic Mix
- Author:
- Michael D Bordo and Mickey D. Levy
- Publication Date:
- 01-2020
- Content Type:
- Journal Article
- Journal:
- The Cato Journal
- Institution:
- The Cato Institute
- Abstract:
- The ratcheting up of tariffs and the Fed’s discretionary conduct of monetary policy are a toxic mix for economic performance. Escalating tariffs and President Trump’s erratic and unpredictable trade policy and threats are harming global economic performance, distorting monetary policy, and undermining the Fed’s credibility and independence. President Trump’s objectives to force China to open access to its markets for international trade, reduce capital controls, modify unfair treatment of intellectual property, and address cybersecurity issues and other U.S. national security issues are laudable goals with sizable benefits. However, the costs of escalating tariffs are mounting, and the tactic of relying exclusively on barriers to trade and protectionism is misguided and potentially dangerous. The economic costs to the United States so far have been relatively modest, dampening exports, industrial production, and business investment. However, the tariffs and policy uncertainties have had a significantly larger impact on China, accentuating its structural economic slowdown, and are disrupting and distorting global supply chains. This is harming other nations that have significant exposure to international trade and investment overseas, particularly Japan, South Korea, and Germany. As a result, global trade volumes and industrial production are falling. Weaker global growth is reflected in a combination of a reduction in aggregate demand and constraints on aggregate supply.
- Topic:
- International Trade and Finance, Monetary Policy, Economic growth, Tariffs, and Industry
- Political Geography:
- Japan, China, Europe, Asia, South Korea, Germany, North America, and United States of America
3. A geographically fair EU industrial strategy
- Author:
- Marta Pilati
- Publication Date:
- 10-2019
- Content Type:
- Policy Brief
- Institution:
- European Policy Centre
- Abstract:
- The industrial transformation towards a more sustainable, technological and knowledge-intensive economy can bring prosperity to the EU, but also bears the risk of increasing disparities among the EU territories. On the one hand, some regions are more fit to benefit from these changes. On the other, economic activity, especially one that is knowledge- and innovation-intensive, tends to spatially cluster in areas that are already more advanced. Productivity, innovation, skills and thriving firms will increasingly concentrate in a few wealthy areas, while the less prosperous are excluded from the gains. The current debate on an EU industrial policy overlooks this issue of inequality and instead focuses on competitiveness vis-à-vis global competitors, key technologies and achieving sustainability commitments. While this is important, the focus on the technological frontier, international trade and knowledge-intensive production could create unintended negative consequences due to the lack of an explicit goal for even development and inclusive industrial transition. In this Policy Brief, Policy Analyst Marta Pilati argues that the EU industrial strategy should be centred on the issue of inequality. This can be achieved by challenging misconceived assumptions, critically evaluating past and future policies, and designing measures that target all EU regions and successfully bring them along the transformation.
- Topic:
- Science and Technology, European Union, Inequality, Trade, and Industry
- Political Geography:
- Europe
4. An Industry Action Plan for a more competitive, sustainable and strategic European Union
- Author:
- Marco Giuli, Claire Dhéret, Johan Bjerkem, Marta Pilati, and Stefan Sipka
- Publication Date:
- 11-2019
- Content Type:
- Policy Brief
- Institution:
- European Policy Centre
- Abstract:
- European industry is falling behind. New and unprecedented challenges and megatrends, from a slowdown in global trade to digital disruption and climate change, are making it increasingly difficult to stay ahead of the curve. However, despite these fast-paced developments, industry remains the backbone of the European economy, delivering high-quality jobs, innovation and world-class companies. To retain its competitive edge, the EU must embrace change and renew its industrial strategy. There is growing political momentum for a revived EU industrial strategy, both in the member states and in the new von der Leyen Commission, which pledged to put forward a new industrial strategy as part of a “European Green Deal”. This Issue Paper presents the results of the EPC’s Task Force on an Industry Action Plan for the European Union, which started in February 2018. It argues that in renewing its industrial strategy, the EU should put in place an ‘Industry Action Plan’, complete with new policy tools and concrete industrial initiatives. Beyond mainstreaming industrial competitiveness across policy areas, the Action Plan should provide a more holistic and policy-oriented approach, with a vision towards 2030 that focuses on competitiveness, sustainability and strategic autonomy: Firstly, to ensure that the European industry remains competitive, the EU should aim to play a stronger role in global value chains, with a higher value-added. Secondly, the EU must create the conditions for the European industry, as well as the products and services it provides, to become sustainable and thus contribute to achieving the Sustainable Development Goals and climate-neutrality in alignment with the United Nation’s Paris Agreement. European industry should become fully climate-neutral by 2050 and seize the opportunity to become a global leader in sustainable and circular business models. Finally, an Industry Action Plan should contribute to achieving greater strategic autonomy for Europe by better responding to distorted competition and levering market power, and moving towards more technological sovereignty. Europe should mobilise all the tools at its disposal to become a global leader in developing digital technologies that address the societal, environmental and health challenges of today. This Paper includes a list of recommendations centred around five policy strands: making the Single Market (including competition policy) work; improving innovation policy and achieving technological sovereignty; acting strategically and enforcing reciprocity; ensuring a fair and inclusive industrial transition; and climate-proofing industry with a 2050 climate neutrality roadmap.
- Topic:
- Climate Change, Science and Technology, European Union, Economy, and Industry
- Political Geography:
- Europe
5. Brexit and trade: Economic effects of Brexit
- Author:
- Philip McCann, Alison McGovern, Thomas Sampson, and Evan Davis
- Publication Date:
- 11-2017
- Content Type:
- Video
- Institution:
- UK in a Changing Europe, King's College London
- Abstract:
- Discussion of evidence on implications of alternative scenarios and how the economic consequences might play out over time and across different industries/regions. Speakers: Philip McCann, University of Sheffield Management School Alison McGovern, MP for Wirral South Thomas Sampson, The UK in a Changing Europe Chair: Evan Davis, Newsnight
- Topic:
- Economics, Brexit, Trade, and Industry
- Political Geography:
- United Kingdom and Europe