Economics News

"China wants to use industrial policies and state support to shape its economy," says Professor of Economics Mary Lovely. "The Trump administration wants to use American market power to force our trading partners to adopt policies that help us shape our economy."

Mary Lovely, professor of economics, says it’s impossible to protect American consumers and put maximum pressure on China at the same time.

For Xi's government, "this particular episode is going to play right into their ability to get people on their side because Trump is seen as the aggressor," says Mary Lovely, professor of economics.

International automakers are "training their future competitors and receiving only a fraction of what their intellectual property would earn" if they were allowed to go it alone in China, says Mary Lovely, professor of economics.

"This was only the first shot," said Mary Lovely, professor of economics, about the Chinese government's retaliatory tariffs on U.S. products exported to China. 

“This is a warning. It means that when China utilizes American technology and innovation to make achievements, the U.S. will not sit aside and simply let it happen,” says Mary Lovely, professor of economics.

"One hope of AGOA [African Growth and Opportunity Act] was labor intensive manufacturing would move into” some of Africa's poorest countries, said Mary Lovely, professor of economics. The comment followed President Trump's announcement of Rwanda's participation in the program.

"A trade war is not inevitable," says Mary Lovely, professor of economics. "But the time is getting very late for us to avoid it."

"The sanctions are a very big deal," says Mary Lovely, professor of economics and senior fellow at the Peterson Institute for International Economics. "The Chinese see them as a major threat and do not want a costly trade war."

Mary Lovely, professor of economics, says the reason why the United States and China have such drastically different tariff rates for imported cars is because of a pre-existing deal between the countries to keep car tariffs high while slashing import taxes on other goods, such as soybeans.

Devashish Mitra, Gerald B. and Daphna Cramer Professor of Global Affairs, argues that "restrictive labor regulations have prevented India from reaping the full potential benefits of opening up the economy."

Steve Hagerty’s company helps communities facing disasters — acts of God and acts of terror that would otherwise overwhelm the regular operations of government.

"If there is predatory dumping (along with injury to indigenous firms and local labour), there needs to be an anti-dumping tax (equal to the calculated dumping margin), which is similar to anti-dumping duties on internationally traded goods," says Devashish Mitra, Gerald B. and Daphna Cramer Professor of Global Affairs.

The web of relationships and mutual benefits between America and China is too complex to dismiss with campaign rhetoric.

"My concern would not be economic, it would be political," says Professor of Economics Mary Lovely regarding last year's rise in the U.S. trade deficit. “I’m afraid this will be more fuel for an aggressive trade stance toward China, afraid that will lead to retaliation by China, and I think it will cause job destruction in the United States as well as in China.”

Instead of raising tariffs India should have emulated China by reforming labor laws and maintaining a low-tariff regime on intermediate goods to attract export-oriented global manufacturing firms, according to Devashish Mitra, Gerald B. and Daphna Cramer Professor of Global Affairs.