Thursday, May 16, 2019

Why China Will Lose More From This Trade War



Tyler Cowen, Bloomberg: China Loses More From This Trade War

It is vulnerable because it is a much poorer country with more fragile political institutions.

With the U.S.-China trade talks now at a halt, odds are that the recent U.S. tariffs on China will continue — and perhaps even rise and multiply. So it’s worth considering what effects those tariffs will have. One prominent argument, which can also serve as a criticism of President Donald Trump, is that the U.S. consumer is the loser. Yet in reality, China is probably in the more vulnerable position.

To be clear, there are well-done studies showing that the recent tariffs have translated into higher prices for U.S. consumers. I am not contesting that research. The question is whether those studies give sufficient weight to all relevant variables for the longer run.

Read more ....

WNU Editor: The above post is 100% right, and it is my must read for today.

No comments: