Solutions: No. No. No.
Determine 1: Internet exports in bn.Ch.2017$ SAAR (blue, left scale), nominal as share of GDP (tan, proper scale). NBER outlined peak-to-trough recession dates shaded grey. Supply: BEA, NBER, and writer’s calculations.
Not solely did internet exports fall in quantity by the tip of Trump 1.0, so too did the online export share of GDP.
Determine 2: Imports ex-petroleum, (blue, left scale), agricultural meals, feeds and drinks (tan, proper scale), in bn.Ch.2017$ SAAR. NBER outlined peak-to-trough recession dates shaded grey. Supply: BEA, NBER.
Ag exports fell pre-pandemic, and solely rose within the post-pandemic ag growth. Imports of products excluding petroleum have been greater by the tip of Trump 1.0.
This may appear stunning if one targeted on the expenditure switching points of tariffs, and thought international nations wouldn’t retaliate in opposition to US exports. On the latter, that at all times appeared foolish to me. On the previous, it’s essential to keep in mind that in a Mundell-Fleming mannequin below floating change charges, the change price will have a tendency to understand, thereby offsetting partially the expenditure switching impact (even ignoring retaliation aimed in opposition to US exports). Additionally, if financial coverage uncertainty rises with commerce wars then one can anticipate but extra greenback appreciation, tending to push up imports.
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