Casualties of trade wars

Liebman, Benjamin H.; Reynolds, Kara M.

doi:10.1016/j.euroecorev.2022.104202

Cited by 1 publication

(1 citation statement)

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“…We chose 2016 as this is the year that President Trump was elected in the United States and begun to discuss a variety of trade measures in retaliation for the so-called "unfair trading practices" of its partners without working through the WTO dispute settlement system. 12 Thus, an increase in retaliatory action may suggest not just a loss in con dence with the WTO DSB, but rather a general return to unilateral trade actions in the wake of the Trump Administration's disregard for the norms of the world trading system. Retaliation speci cally in response to the Trump Administration's steel and aluminum tariffs and US-China trade wars has been extensively studied in Liebman and Reynolds (2022).…”

Section: The Increased Use Of Retaliationmentioning

confidence: 99%

Multi-mode Trade Policy Retaliation1

Feinberg,

Nes,

Reynolds

et al. 2023

Preprint

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Previous studies have found evidence that countries may choose to retaliate against countries for certain trade actions. What has not been empirically examined is the use of multi-modal retaliation in trade policy. Using an exporter-importer-sector panel of antidumping (AD), sanitary and phytosanitary (SPS), and technical barriers to trade (TBT) actions between 1995 and 2019, we find evidence of both cross-sector and cross-agreement retaliation: importers are statistically more likely to initiate an AD petition against an exporter if they have an ongoing SPS-related concern against that exporter. The World Trade Organization’s dispute settlement body (DSB) was initially seen as promoting the stability of the global trading system by limiting such unilateral retaliation, widespread throughout the 1980s. We find statistical evidence suggesting that countries may be increasingly engaging in unilateral actions, particularly through SPS and TBT, in response to trade policy disputes as confidence in the WTO DSB falls. Our findings suggest that countries may expect more unilateral retaliatory action through SPS and TBT if recent efforts to reform the WTO DSB fail.

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Section: The Increased Use Of Retaliationmentioning

confidence: 99%