The US-China trade war with increasing trade policy uncertainty
| Autor: | İsmet Göçer, Serdar Ongan |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Commercial policy
Trade war Distributed lag 050208 finance Index (economics) Short run 05 social sciences Balance of trade International economics Bilateral trade Balance (accounting) 0502 economics and business Economics 050207 economics Business and International Management General Economics Econometrics and Finance |
| Zdroj: | Journal of Chinese Economic and Foreign Trade Studies. 13:87-94 |
| ISSN: | 1754-4408 |
| Popis: | Purpose This study aims to examine the impacts of changing US trade policy uncertainty (henceforth, TPU Index) on US bilateral trade balance with China from a nonlinear methodology perspective. Design/methodology/approach The nonlinear auto regressive distributed lag (ARDL) model, recently developed by Shin et al. (2014), is applied. This model decomposes the TPU Index series into its increases (TPU+) and decreases (TPU−) and creates two new TPU Index series. Findings Empirical findings indicate that increases in the TPU Index improve the US bilateral trade balance only in the short-run (no long-run impact). However, decreases in the TPU Index worsen the US trade balance in the short run but improve it in the long run. Apart from these effects detected on US–China bilateral trade balances, this empirical study draws the conclusion that changing trade policy uncertainty plays a significant determining role for bilateral trade volumes. Originality/value Decomposed TPU index with the nonlinear ARDL model enables us to examine the separate impacts of the changes in TPU+ and TPU− indexes on US bilateral trade balance with China. Therefore, this model may discover potentially concealed-hidden true impacts of TPU index on US bilateral trade balance with this country. |
| Databáze: | OpenAIRE |
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