Question

Problem 1. China-US Trade War What was the origin of China-US Trade War? How did it escalate? Who are the winners and losers (countries, individuals, firms, farmers, etc.)?

Problem 2. China-US Trade Deficit It has been controversial whether running trade deficit against China is good/bad for the US economy. What are the arguments on both sides and which part do you agree?

Problem 3. Covid-19, International Trade and Economy What is the impact of covid-19 on international trade, global supply chain and the economies around the world?

Problem 4. Trade and Manufacturing Employment in the US Manufacturing employment in the US has been swiftly declining since 1980s. Is trade to blame?

Problem 6. Migration What are the benefit and loss associated with limiting legal/illegal migrants for the US?

Answer 1

1)

China-US trade war has taken a new dimension. China has been manipulating its currency and keeping its value artificially low. The low exchange rate of China has led to the fall in export of the US. Thus, the trade deficit in the US has increased significantly. The US-China trade deficit is over the $ 420 Billion which is mammoth and it must be tackled at earliest.

Thus, the US has imposed the duty on the products from China. US firms are being benefitted by such actions. But US consumers are not being benefitted by such a move of the government. Products are becoming costlier in the USA. Thus consumer surplus is decreasing.