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Trade And The Crisis: Protect Or Recover

Author

Listed:
  • ROB GREGORY

    (Strategy, Policy, and Review Department, International Monetary Fund, 700 19th Street, NW, Washington, D.C., 20431, USA)

  • CHRISTIAN HENN

    (Strategy, Policy, and Review Department, International Monetary Fund, 700 19th Street, NW, Washington, D.C., 20431, USA)

  • BRAD MCDONALD

    () (Strategy, Policy, and Review Department, International Monetary Fund, 700 19th Street, NW, Washington, D.C., 20431, USA)

  • MIKA SAITO

    (Strategy, Policy, and Review Department, International Monetary Fund, 700 19th Street, NW, Washington, D.C., 20431, USA)

Abstract

We show that new trade restrictions implemented since the onset of the global financial crisis have had — in the limited products targeted — a strong distortionary impact on trade. Their aggregate impact is modest, however, as most countries have resisted a widespread resort to protectionism. Looking ahead, sustained high unemployment, uneven growth, and an unwinding of government stimulus measures suggest that protectionist pressures may rise. Continuing and further enhancing monitoring of all protectionist measures will help, but the surest way to avoid such a downside scenario is to tighten multilateral trade commitments by completing the World Trade Organization (WTO) Doha Round.

Suggested Citation

  • Rob Gregory & Christian Henn & Brad Mcdonald & Mika Saito, 2010. "Trade And The Crisis: Protect Or Recover," Journal of International Commerce, Economics and Policy (JICEP), World Scientific Publishing Co. Pte. Ltd., vol. 1(02), pages 165-181.
  • Handle: RePEc:wsi:jicepx:v:01:y:2010:i:02:n:s1793993310000111
    DOI: 10.1142/S1793993310000111
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    References listed on IDEAS

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    1. Iacovone, Leonardo & Zavacka, Veronika, 2009. "Banking crises and exports : lessons from the past," Policy Research Working Paper Series 5016, The World Bank.
    2. Andrei A. Levchenko & Logan Lewis & Linda L. Tesar, 2009. "The Collapse of International Trade During the 2008-2009 Crisis: In Search of the Smoking Gun," Working Papers 592, Research Seminar in International Economics, University of Michigan.
    3. Faruqee, Hamid & Laxton, Douglas & Muir, Dirk & Pesenti, Paolo, 2008. "Would protectionism defuse global imbalances and spur economic activity? A scenario analysis," Journal of Economic Dynamics and Control, Elsevier, vol. 32(8), pages 2651-2689, August.
    4. Matthieu Bussière & Emilia Pérez‐Barreiro & Roland Straub & Daria Taglioni, 2011. "Protectionist Responses to the Crisis: Global Trends and Implications," The World Economy, Wiley Blackwell, vol. 34, pages 826-852, May.
    5. Malouche, Mariem, 2009. "Trade and trade finance developments in 14 developing countries post September 2008 - a World Bank survey," Policy Research Working Paper Series 5138, The World Bank.
    6. Matthieu Bussière & Emilia Pérez‐Barreiro & Roland Straub & Daria Taglioni, 2011. "Protectionist Responses to the Crisis: Global Trends and Implications," The World Economy, Wiley Blackwell, vol. 34, pages 826-852, May.
    7. Michael P. Leidy, 1997. "Macroeconomic Conditions and Pressures for Protection under Antidumping and Countervailing Duty Laws: Empirical Evidence from the United States," IMF Staff Papers, Palgrave Macmillan, vol. 44(1), pages 132-144, March.
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    Citations

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    Cited by:

    1. Marga PEETERS, 2011. "The Changing Pattern in International Trade and Capital Flows of the Gulf Cooperation Council Countries in Comparison with other Oil-Exporting Countries," Journal of Knowledge Management, Economics and Information Technology, ScientificPapers.org, vol. 1(7), pages 1-29, December.
    2. Leonardo Baccini & Soo Kim, 2012. "Preventing protectionism: International institutions and trade policy," The Review of International Organizations, Springer, vol. 7(4), pages 369-398, December.
    3. Ortiz, Isabel, & Cummins, Matthew. & Karunanethy, Kalaivani., 2015. "Fiscal space for social protection options to expand social investments in 187 countries," ILO Working Papers 994877663402676, International Labour Organization.
    4. Marcel Kohler & Adrian Saville, 2011. "Measuring the Impact of Trade Finance on South African Export Flows," Working Papers 232, Economic Research Southern Africa.
    5. Brad J. McDonald & Christian Henn, 2011. "Protectionist Responses to the Crisis; Damage Observed in Product-Level Trade," IMF Working Papers 11/139, International Monetary Fund.
    6. Nidal Rashid Sabri & Marga Peeters & Diama K. Abulaban, 2012. "The impact of exchange rate volatility on trade integration among North and South Mediterranean countries," International Journal of Business and Globalisation, Inderscience Enterprises Ltd, vol. 9(2), pages 107-121.
    7. Chauvin, Nicolas Depetris & Ramos, Maria Priscila, 2013. "The welfare effect of the new wave of protectionism: The case of Argentina," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151626, Agricultural and Applied Economics Association.
    8. Peeters, Marga & Sabri, Nidal Rachid, 2012. "International financial integration of Mediterranean economies : A bird’s-eye view," MPRA Paper 38081, University Library of Munich, Germany.
    9. Marga Peeters, 2010. "The changing pattern of international trade and capital flows of the GCC countries," European Economy - Economic Papers 2008 - 2015 415, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    10. Isabel Ortiz & Jingqing Chai & Matthew Cummins, 2011. "Identifying Fiscal Space:Options for Social and Economic Development for Children and Poor Households in 184 Countries," Working papers 1108, UNICEF,Division of Policy and Strategy.
    11. van Bergeijk, P.A.G., 2011. "One is not enough!," ISS Working Papers - General Series 22964, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    12. Baccini, Leonardo & Kim, Soo Yeon, 2012. "Preventing protectionism: international institutions and trade policy," LSE Research Online Documents on Economics 45573, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    Protectionism; transparency; WTO; F02; F13; F40;

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General

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