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US Economic Sanctions Against China: Who Gets Hurt?

Author

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  • Jiawen Yang
  • Hossein Askari
  • John Forrer
  • Hildy Teegen

Abstract

The United States maintains a broad spectrum of economic sanctions against China ranging from export controls to prohibitions on certain imports. Our study finds that, although from a macroeconomic perspective, US sanctions have had no significant adverse effect on China's overall economic growth and trade between the two countries, they do have a negative impact on producers and consumers in both countries. US economic sanctions have hindered technology transfer to China and US investment in China. US restrictions on imports from China have caused deadweight losses for the US due to higher domestic production costs for import substitutes and a reduction in consumption. US export controls have hindered US exports to China and contributed to large US trade deficits with China. The export controls have also caused losses of high‐paid jobs in the United States and benefited competitors from other countries. In addition, US economic sanctions against China have had significant third‐party effects. China's diversification of imports to sources other than the United States may have a long‐term effect on US exports to China even after US economic sanctions against China are lifted.

Suggested Citation

  • Jiawen Yang & Hossein Askari & John Forrer & Hildy Teegen, 2004. "US Economic Sanctions Against China: Who Gets Hurt?," The World Economy, Wiley Blackwell, vol. 27(7), pages 1047-1081, July.
  • Handle: RePEc:bla:worlde:v:27:y:2004:i:7:p:1047-1081
    DOI: 10.1111/j.1467-9701.2004.00640.x
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    References listed on IDEAS

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    1. Nicholas R. Lardy, 1994. "China in the World Economy," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 24, October.
    2. James A. Dorn, 1996. "Trade and Human Rights: The Case of China," Cato Journal, Cato Journal, Cato Institute, vol. 16(1), pages 63-76, Spring/Su.
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    1. Estrada, Mario Arturo Ruiz & Koutronas, Evangelos, 2022. "The impact of the Russian Aggression against Ukraine on the Russia-EU Trade," Journal of Policy Modeling, Elsevier, vol. 44(3), pages 599-616.
    2. Chen, Yin E. & Fu, Qiang & Zhao, Xinxin & Yuan, Xuemei & Chang, Chun-Ping, 2019. "International sanctions’ impact on energy efficiency in target states," Economic Modelling, Elsevier, vol. 82(C), pages 21-34.
    3. Gutmann, Jerg & Neuenkirch, Matthias & Neumeier, Florian, 2022. "Do China and Russia Undermine US Sanctions? Evidence from DiD and Event Study Estimation," ILE Working Paper Series 64, University of Hamburg, Institute of Law and Economics.
    4. Mary-Françoise Renard, 2004. "La montée en puissance de la Chine dans le commerce mondial : une réussite spectaculaire pour une économie fragile," Revue d'Économie Financière, Programme National Persée, vol. 77(4), pages 43-61.

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