Economics News

"Unfortunately, I believe it may do little to expand employment in the auto sector and will hurt auto buyers," says Mary Lovely, professor of economics. "The new rules raise the cost of production in North America, raise prices for auto buyers, and reduce overall auto and truck sales."

Mary Lovely, professor of economics, says the new U.S. trade deal with Canada is a "clear signal" that the U.S. is "circling the wagons against China."

"They are trying to threaten the Canadians into signing a deal that at this point the Canadians don’t want to sign and there is a gigantic bogeyman in the room which is the 25 percent tariff on Canadian auto imports," says Mary Lovely, professor of economics.

Devashish Mitra, professor of economics and Gerald B. and Daphna Cramer Professor of Global Affairs, says, "any tariff increase will come at a huge cost to India’s consumers as well as producers who use imported inputs."

According to Stuart Rosenthal, professor and chair of economics, market-rate housing filters down at a rate of almost 2 percent per year—fast enough to make a big difference. Housing filters fastest in the middle of the country, but it filters down on the expensive coasts, too, he found. 

According to Mary Lovely, professor of economics, most of the tariffs that have been imposed have hit U.S. companies, not the Chinese.

"The first few rounds of tariffs hit supply chains really hard," says Mary Lovely, professor of economics. Now, the Trump administration "has begun to hit things clearly not processed in the U.S.—consumer goods—and this is going to get people’s attention."

"Trade policy has very little direct impact on the overall trade deficit in the longer run," said Mary Lovely, professor of economics.

Gary Engelhardt, professor of economics, and his co-authors found that early Social Security claiming leads to a significant increase in the number of retirees living in poverty.

"The unemployment rate has been low for some months now (relative to the recent past), but there has not been noticeable pressure on wages," says Alfonso Flores-Lagunes, professor of economics.

The fellowship is made possible by generous gifts to the Astrid Merget Fund honoring two-time alumna and former associate dean of the Maxwell School Astrid Merget ’68 M.P.A./’73 Ph.D. (SSc).

"What this deal really is signaling is that this administration is going to go forward with a 25% tariff on autos," says Mary Lovely, professor of economics. "That's going to greatly upset our partners in the EU, in Japan."

Professor of Economics Mary Lovely says negotiators should seek specific policy changes that will address the reason for these tariffs in the first place—U.S. allegations that China treats American firms unfairly with respect to their technology and intellectual property.

"The companies that use steel, like aluminum can manufacturers, or companies that make steel vats for pharmaceuticals or the dairy industry, they're going to be hurt by this," says Mary Lovely, professor of economics.

"If jobs and wealth are the metric for 'winning the trade war,' China, not America, will emerge the victor," says Mary Lovely, professor of economics.