Trade Wars: Nobody Expects the Spanish Inquisition

21 Pages Posted: 6 Nov 2019

See all articles by Eddy Bekkers

Eddy Bekkers

World Trade Organization (WTO)

Joseph F. Francois

University of Bern - Department of Economics; Centre for Economic Policy Research (CEPR); Vienna Institute of International Economic Studies (WIIW); University of Adelaide - School of Economics

Douglas Nelson

Tulane University - Department of Economics

Hugo Rojas-Romagosa

World Bank

Multiple version iconThere are 2 versions of this paper

Date Written: October 2019

Abstract

This paper assesses the utility of economic theory of rational trade wars to predict such events or to prescribe courses of action to control their consequences. Trade wars are fundamentally political events whose causes are almost completely political and whose consequences are to a significant degree also political. Contemporary economic theory has developed during a uniquely peaceful and liberal period in world history, affecting how economists have thought about trade conflicts, leaving the profession unprepared to provide serious analysis or advice.

Keywords: general equilibrium trade models, International Political Economy, optimal taxation, trade wars

JEL Classification: F13, F14

Suggested Citation

Bekkers, Eddy and Francois, Joseph F and Nelson, Douglas R. and Rojas-Romagosa, Hugo, Trade Wars: Nobody Expects the Spanish Inquisition (October 2019). CEPR Discussion Paper No. DP14079, Available at SSRN: https://ssrn.com/abstract=3478775

Eddy Bekkers (Contact Author)

World Trade Organization (WTO) ( email )

Rue de Lausanne 154
Geneva 21, CH-1211
Switzerland

Joseph F Francois

University of Bern - Department of Economics ( email )

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Bern, CH-3001
Switzerland

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Vienna Institute of International Economic Studies (WIIW) ( email )

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A-1010 Vienna
Austria

University of Adelaide - School of Economics ( email )

Adelaide SA, 5005
Australia
+61 8 8303 5540 (Phone)
+61 8 8223 1460 (Fax)

Douglas R. Nelson

Tulane University - Department of Economics ( email )

New Orleans, LA 70118
United States

Hugo Rojas-Romagosa

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States
20433 (Fax)

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