Bown, Chad P.Crowley, Meredith A.2012-04-272012-04-272012-04https://hdl.handle.net/10986/6040This research estimates the impact of macroeconomic fluctuations on import protection policies over 1988:Q1-2010:Q4 for the United States, European Union, and three other industrialized economies. First, estimates on a pre-Great Recession sample provide evidence of three key relationships for the US and EU. Increases in domestic unemployment rates and real appreciations in bilateral exchange rates led to substantial increases in antidumping and related forms of import protection. Furthermore, economies historically imposed these bilateral import restrictions on trading partners going through their own periods of weak economic growth. Second, estimates from the pre-Great Recession model predict a major trade policy response during 2008:Q4-2010:Q4, given the realized macroeconomic shocks. New US and EU trade barriers were projected to cover up to an additional 15 percentage points of nonoil imports, well above the baseline level of 2-3 percent of import coverage immediately preceding the crisis. Third, re-estimating the model on data from the Great Recession period illustrates why the realized trade policy response differed from model predictions based on historical data. While exchange rate movements played an important role in limiting new import protection, the US and EU also "switched" from their historical behavior during the Great Recession and shifted new import protection toward trading partners experiencing economic growth and away from those that were contracting.CC BY 3.0 IGOAGREEMENT ON SAFEGUARDSANNUAL IMPORTSANTIDUMPINGANTIDUMPING CASESANTIDUMPING DUTIESANTIDUMPING FILINGSANTIDUMPING POLICYBILATERAL EXCHANGE RATEBILATERAL EXCHANGE RATESBILATERAL IMPORTSBILATERAL RELATIONSHIPSBILATERAL TRADEBUSINESS CYCLEBUSINESS CYCLESCAPACITY CONSTRAINTSCHANGES IN TRADECLARITYCOUNTERVAILING DUTIESCOUNTERVAILING DUTY INVESTIGATIONCUMULATIVE EFFECTCURRENCYCURRENCY APPRECIATIONSCURRENCY DEPRECIATIONSDEMAND SHOCKSDEPENDENT VARIABLEDEPENDENT VARIABLESDEPRESSIONDEVELOPING COUNTRIESDEVELOPMENT POLICYDISPUTE SETTLEMENTDOMESTIC CURRENCYDOMESTIC CURRENCY PRICEDOMESTIC ECONOMYDOMESTIC INDUSTRYDOMESTIC MARKETDOMESTIC UNEMPLOYMENTDUMMY VARIABLESECONOMETRIC MODELSECONOMIC CONTRACTIONECONOMIC GROWTHECONOMIC RESEARCHEUROPEAN UNIONEXCHANGE RATEEXCHANGE RATE APPRECIATIONEXCHANGE RATE APPRECIATIONSEXCHANGE RATE DATAEXCHANGE RATE FLUCTUATIONSEXCHANGE RATE INCREASEEXCHANGE RATE MOVEMENTEXCHANGE RATE MOVEMENTSEXCHANGE RATE SHOCKEXCHANGE RATESEXPLANATORY VARIABLEEXPLANATORY VARIABLESEXPORT RESTRICTIONSEXPORTERSEXPORTSEXTERNALITIESFEDERAL RESERVEFEDERAL RESERVE BANKFINANCIAL CRISISFIXED EFFECTSFOREIGN COUNTRYFOREIGN FIRMFOREIGN FIRMSFOREIGN SOURCESFORMAL ANALYSISGENERAL AGREEMENT ON TARIFFSGLOBAL TRADEGROWTH RATEIMPERFECT COMPETITIONIMPORTIMPORT DATAIMPORT GROWTHIMPORT POLICYIMPORT PRICEIMPORT PRODUCTIMPORT PROTECTIONIMPORT RESTRICTIONIMPORT RESTRICTIONSIMPORT TARIFFSIMPORT VALUEIMPORTED PRODUCTSIMPORTING COUNTRYIMPORTSINDUSTRIALIZED COUNTRIESINDUSTRY TRADEINTERNATIONAL BANKINTERNATIONAL BUSINESSINTERNATIONAL ECONOMICSINTERNATIONAL TRADEINTERNATIONAL TRADE RULESINTERNATIONAL TRADINGITCLEGAL CONDITIONLEVELS OF IMPORTLOCAL CURRENCYLOW TARIFFSMACROECONOMIC CONDITIONSMACROECONOMIC FACTORSMACROECONOMIC FLUCTUATIONSMACROECONOMIC INDICATORSMACROECONOMIC SHOCKMACROECONOMIC SHOCKSMANAGED TRADEMARGINAL COSTMARKET ECONOMYMULTILATERAL NEGOTIATIONSMULTINATIONAL FIRMSNATIONAL AUTHORITYNATIONAL CURRENCYNON-MARKET ECONOMYOIL IMPORTSPATENTSPOLICY RESEARCHPRICE INDEXPRICE INDICESPROTECTIONISMPROTECTIONISTRATE OF GROWTHREAL APPRECIATIONREAL APPRECIATIONSREAL DEPRECIATIONSREAL EXCHANGE RATEREAL EXCHANGE RATESREAL GDPRECESSIONRECESSIONSRECIPROCAL DUMPINGROBUSTNESS CHECKROBUSTNESS CHECKSSTANDARD DEVIATIONSTANDARD DEVIATIONSTARIFF INCREASESTARIFF PROTECTIONTARIFF-RATE QUOTATERMS OF TRADETERMS-OF-TRADE GAINSTRADE AGREEMENTSTRADE ALERTTRADE BARRIERTRADE BARRIERSTRADE FLOWSTRADE GROWTHTRADE IN GOODSTRADE MODELSTRADE POLICIESTRADE POLICYTRADE POLICY INSTRUMENTSTRADE PROTECTIONTRADE RESTRICTIONSTRADE RESTRICTIVENESSTRADE RULESTRADE VALUESTRADE VOLUMETRADING PARTNERTRADING PARTNERSUNCERTAINTYUNEMPLOYMENT RATEUNEMPLOYMENT RATESVALUE OF IMPORTSVERTICAL SPECIALIZATIONWORLD ECONOMYWORLD TRADEWORLD TRADE ORGANIZATIONWORLD TRADING SYSTEMWTOWorld Bank10.1596/1813-9450-6038