Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/229117
Authors: 
Cigna, Simone
Meinen, Philipp
Schulte, Patrick
Steinhoff, Nils
Year of Publication: 
2020
Series/Report no.: 
ECB Working Paper No. 2503
Abstract: 
In this paper we provide evidence on the existence of short-run trade diversion effects towards third countries as a consequence of tariff shocks. We exploit sudden policy changes in the context of the trade dispute between the US and China. Based on a data set covering monthly product-level information on US imports from 30 countries for the period January 2016 until May 2019, we employ a difference-in-differences estimation framework. Doing so, we (1) can confirm previous findings showing a strong negative direct effect of US tariffs on US imports from China, but (2) do not find evidence for significant short-run trade diversion effects towards third countries. This latter finding holds for product and country subgroups as well as for a variety of robustness checks.
Subjects: 
Tariffs
US imports
trade diversion
product-level data
difference-in-differences
JEL: 
F13
F14
F61
Persistent Identifier of the first edition: 
ISBN: 
978-92-899-4449-6
Document Type: 
Working Paper

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