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U.S. Adjustment in the 1990's: A CGE Analysis of Alternative Trade Strategies

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  • Hanson, Kenneth
  • Robinson, Sherman
  • Tokarick, Stephen

Abstract

This paper investigates the implications for the structure of the U.S. economy of a reduction in the U.S. trade deficit. We explore two alternative adjustment scenarios. First, we assume an environment of successful world trade liberalization. An alternative view is that the world economy will lapse into a protectionist environment. We use a 30-sector computable general equilibrium (CGE) model of the United States to analyze the impact of these two scenarios. When analyzing the protectionist scenario, we do a variety of experiments designed to explore the impact of protectionist policies on the U.S. economy.

Suggested Citation

  • Hanson, Kenneth & Robinson, Sherman & Tokarick, Stephen, 1990. "U.S. Adjustment in the 1990's: A CGE Analysis of Alternative Trade Strategies," Staff Reports 278325, United States Department of Agriculture, Economic Research Service.
    • Handle: RePEc:ags:uerssr:278325
    DOI: 10.22004/ag.econ.278325
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    References listed on IDEAS

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    1. Kilkenny, Maureen & Robinson, Sherman, 1990. "Economywide Implications of Agricultural Liberalization in the United States," CUDARE Working Papers 198562, University of California, Berkeley, Department of Agricultural and Resource Economics.
    2. Mussa, Michael, 1974. "Tariffs and the Distribution of Income: The Importance of Factor Specificity, Substitutability, and Intensity in the Short and Long Run," Journal of Political Economy, University of Chicago Press, vol. 82(6), pages 1191-1203, Nov.-Dec..
    3. Ethier, Wilfred, 1974. "Some of the theorems of international trade with many goods and factors," Journal of International Economics, Elsevier, vol. 4(2), pages 199-206, May.
    4. Jaime de MELO & Sherman ROBINSON, 2015. "Product Differentiation And The Treatment Of Foreign Trade In Computable General Equilibrium Models Of Small Economies," World Scientific Book Chapters, in: Modeling Developing Countries' Policies in General Equilibrium, chapter 2, pages 21-41, World Scientific Publishing Co. Pte. Ltd..
    5. Fohlin, Caroline & Robinson, Sherman & Schluter, Gerald E., 1989. "Terms of Trade and Factor Commitments in Agriculture," Journal of Agricultural Economics Research, United States Department of Agriculture, Economic Research Service, vol. 41(4), pages 1-6.
    6. Malley, James R. & Bell, David & Foster, John, 1991. "The specification, estimation and simulation of a small global macroeconomic model," Economic Modelling, Elsevier, vol. 8(4), pages 546-559, October.
    7. Chalfant, James A, 1987. "A Globally Flexible, Almost Ideal Demand System," Journal of Business & Economic Statistics, American Statistical Association, vol. 5(2), pages 233-242, April.
    8. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 9(1), pages 58-73.
    9. W. M. Corden, 1966. "The Structure of a Tariff System and the Effective Protective Rate," Journal of Political Economy, University of Chicago Press, vol. 74(3), pages 221-221.
    10. Hanson, Kenneth A. & Robinson, Sherman, 1989. "Data, Linkages, And Models: U.S. National Income And Product Accounts In The Framework Of A Social Accounting Matrix," Staff Reports 278155, United States Department of Agriculture, Economic Research Service.
    11. Jones, Ronald W & Scheinkman, Jose A, 1977. "The Relevance of the Two-Sector Production Model in Trade Theory," Journal of Political Economy, University of Chicago Press, vol. 85(5), pages 909-935, October.
    12. Mayer, Wolfgang, 1974. "Short-Run and Long-Run Equilibrium for a Small Open Economy," Journal of Political Economy, University of Chicago Press, vol. 82(5), pages 955-967, Sept./Oct.
    13. Hollis Chenery† & T.N. Srinivasan (ed.), 1989. "Handbook of Development Economics," Handbook of Development Economics, Elsevier, edition 1, volume 2, number 2.
    14. Salvatore, Dominick, 1985. "The new protectionism and the threat to world welfare: Editor's introduction," Journal of Policy Modeling, Elsevier, vol. 7(1), pages 1-22.
    15. Kilkenny, Maureen, 1988. "Modelling the Removal of Production Incentive Distortions in the US Agricultural Sector," 1988 Conference, August 24-31, 1988, Buenos Aires, Argentina 183151, International Association of Agricultural Economists.
    16. Ronald Findlay & Stanislaw Wellisz, 1982. "Endogenous Tariffs, the Political Economy of Trade Restrictions, and Welfare," NBER Chapters, in: Import Competition and Response, pages 223-244, National Bureau of Economic Research, Inc.
    17. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-326, June.
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    Citations

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    Cited by:

    1. Lewis, Jeffrey D. & Robinson, Sherman & Wang, Zhi, 1995. "Beyond the Uruguay Round: The implications of an Asian free trade area," China Economic Review, Elsevier, vol. 6(1), pages 35-90.
    2. Hinojosa-Ojeda, Raul & Robinson, Sherman, 1992. "Labor Issues in a North American Free Trade Area," CUDARE Working Papers 198601, University of California, Berkeley, Department of Agricultural and Resource Economics.
    3. Hinojosa-Ojeda, Raul A. & Robinson, Sherman & Lewis, Jeffrey D., 1995. "Regional integration options for Central America and the Caribbean after NAFTA," The North American Journal of Economics and Finance, Elsevier, vol. 6(2), pages 121-148.
    4. Lin, Tun & De Guzman, Franklin, 2007. "Tourism for pro-poor and sustainable growth: economic analysis of tourism projects," MPRA Paper 24994, University Library of Munich, Germany.
    5. Dote, Grace, 1991. "Economic Research Of Interest To Agriculture, 1988-1990," Economic Research of Interest to Agriculture 7326, University of California, Berkeley, Department of Agricultural and Resource Economics.
    6. Hinojosa-Ojeda, Raul A. & Robinson, Sherman & De Paolis, Fernando, 1999. "Regional integration among the unequal: a CGE model of NAFTA and the Central American republics," The North American Journal of Economics and Finance, Elsevier, vol. 10(1), pages 235-292.
    7. Devarajan, Shantayanan & Go, Delfin S. & Hongyi Li, 1999. "Quantifying the fiscal effects of trade reform," Policy Research Working Paper Series 2162, The World Bank.
    8. Alexandre Gohin & Herve Guyomard & Nadine Herrard & Thierry Trochet, 1996. "La maquette MEGALEX du modèle d'Equilibre Général de l'Agriculture et de l'Agro-Alimentaire Français MEGAAF," Working Papers hal-01511387, HAL.
    9. Lewis, Jeffrey D. & Robinson, Sherman & Thierfelder, Karen, 1999. "After the negotiations: assessing the impact of free trade agreements in Southern Africa," TMD discussion papers 46, International Food Policy Research Institute (IFPRI).

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