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U.S.-Japan and U.S.-China trade conflict : export growth, reciprocity, and the international trading system

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  • Bown, Chad P.
  • McCulloch, Rachel

Abstract

First Japan and more recently China have pursued export-oriented growth strategies. While other Asian countries have done likewise, Japan and China are of particular interest because their economies are so large and the size of the associated bilateral trade imbalances with the United States so conspicuous. In this paper the authors focus on U.S. efforts to restore the reciprocal GATT/WTO market-access bargain in the face of such large imbalances and the significant spillovers to the international trading system. The paper highlights similarities and differences in the two cases. The authors describe U.S. attempts to reduce the bilateral imbalances through targeted trade policies intended to slow growth of U.S. imports from these countries or increase growth of U.S. exports to them. They then examine how these trade policy responses, as well as U.S. efforts to address what were perceived as underlying causes of the imbalances, influenced the evolution of the international trading system. Finally, the authors compare the macroeconomic conditions associated with the bilateral trade imbalances and their implications for the conclusions of the two episodes.

Suggested Citation

  • Bown, Chad P. & McCulloch, Rachel, 2009. "U.S.-Japan and U.S.-China trade conflict : export growth, reciprocity, and the international trading system," Policy Research Working Paper Series 5102, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5102
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    References listed on IDEAS

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    Cited by:

    1. Charlier, Christophe & Guillou, Sarah, 2014. "Distortion effects of export quota policy: an analysis of the China-Raw Materials dispute," China Economic Review, Elsevier, vol. 31(C), pages 320-338.
    2. Kokko, Ari & Gustavsson Tingvall, Patrik & Videnord, Josefin, 2017. "Which Antidumping Cases Reach the WTO?," Ratio Working Papers 286, The Ratio Institute.
    3. Bown, Chad P. & Crowley, Meredith A, 2016. "The Empirical Landscape of Trade Policy," CEPR Discussion Papers 11216, C.E.P.R. Discussion Papers.
    4. Rachel McCulloch, 2010. "The International Trading System and Its Future," Working Papers 08, Brandeis University, Department of Economics and International Businesss School.
    5. Aaditya Mattoo & Arvind Subramanian, 2012. "China and the World Trading System," The World Economy, Wiley Blackwell, vol. 35(12), pages 1733-1771, December.
    6. Sun, Sizhong, 2012. "The role of FDI in domestic exporting: Evidence from China," Journal of Asian Economics, Elsevier, vol. 23(4), pages 434-441.
    7. Andrea Fracasso, 2015. "Economic Rebalancing and Growth: the Japanese experience and China’s prospects," DEM Discussion Papers 2015/07, Department of Economics and Management.

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    Keywords

    Free Trade; Trade Law; Economic Theory&Research; Trade Policy; Currencies and Exchange Rates;

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