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1. Trade Disputes With China Shoot US In The Foot

Author:
Li Chunding
Publication Date:
04-2018
Content Type:
Policy Brief
Abstract:
US-China trade friction has intensified, and one excuse that the Trump administration has used for trade protectionism against China is that China has been stealing US jobs, especially in the manufacturing sector. But bilateral trade has nothing to do with unemployment in the US. China itself or trade with China is merely scapegoats. The US is being a fault finder without realizing that the real reasons are internal, and the trade conflict will jeopardize manufacturing jobs on both sides.
Topic:
Bilateral Relations, Trade Wars, Trade, and Unemployment
Political Geography:
China, Asia, North America, and United States of America

2. Who Can Win the Possible China-US Trade War?

Author:
Li Chunding
Publication Date:
03-2018
Content Type:
Working Paper
Abstract:
This paper uses a multi-country global general equilibrium (GE) model to numerically simulate the effects of possible China-US trade wars. We introduce an endogenous trade imbalance structure with trade cost into the model which helps to explore both tariff and non-tariff trade war effects. Our simulation results show that China will be significantly hurt by the China-US trade war, but negative impacts are affordable. The US can gain under unilateral sanction measures to China, but will lose if China takes retaliation measures. Comparing the effects under mutual trade war, China will lose more than the US. Introducing non-tariff barrier trade wars will intensify the negative effects, and comparatively negative effects to China are larger than to the US. Mexico’s involvement in trade war with the US will strengthen the negative effects and comparatively hurt the US more. Under non-cooperative and cooperative Nash bargaining equilibrium, the US can gain more than China in trade war negotiation, which means the US has stronger bargaining power than China. Additionally, trade wars between China and the US will hurt most countries and the world especially in GDP and manufacturing employment, but benefit their welfare and trade.
Topic:
Bilateral Relations, Trade Wars, and Trade
Political Geography:
China, Asia, North America, and United States of America