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Globalization? Trade War? A Counterbalance Perspective

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  • Xingwei Hu

Abstract

The embrace of globalization and protectionism among economies has ebbed and flowed over the past few decades. These fluctuations call for quantitative analytics to help countries improve their trade policies. Changing attitudes toward globalization also imply that the best trade policies vary over time and are country-specific. We argue that the imports and exports of all economies constitute a counterbalanced network where conflict and cooperation are two sides of the same coin. Quantitative competitiveness is then formulated for each country using a network counterbalance equilibrium. A country could improve its relative strength in the network by embracing globalization, protectionism, trade collaboration, or conflict. This paper presents some necessary conditions for globalization and trade wars, evaluates their side effects, derives national bargaining powers, identifies appropriate targets for conflict or collaboration, and recommends fair resolutions for trade conflicts. Data and events from 2000 to 2019 support these conditions.

Suggested Citation

  • Xingwei Hu, 2020. "Globalization? Trade War? A Counterbalance Perspective," Papers 2009.03436, arXiv.org, revised Nov 2024.
    • Handle: RePEc:arx:papers:2009.03436
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    References listed on IDEAS

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    1. Xingwei Hu, 2020. "Sorting Big Data by Revealed Preference with Application to College Ranking," Papers 2003.12198, arXiv.org.
    2. Grossman, Gene M & Helpman, Elhanan, 1995. "Trade Wars and Trade Talks," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 675-708, August.
    3. Hu, Xingwei & Shapley, Lloyd S., 2003. "On authority distributions in organizations: equilibrium," Games and Economic Behavior, Elsevier, vol. 45(1), pages 132-152, October.
    4. Ralph Ossa, 2014. "Trade Wars and Trade Talks with Data," American Economic Review, American Economic Association, vol. 104(12), pages 4104-4146, December.
    5. Harrison, Glenn W & Rutstrom, E E, 1991. "Trade Wars, Trade Negotiations and Applied Game Theory," Economic Journal, Royal Economic Society, vol. 101(406), pages 420-435, May.
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