Sanctions, Tariffs Ind. Pol

3 Credits · Level: Graduate

For decades, lead economies have been champions of greater economic ties, that expanding trade and capital flows would raise incomes and even foster peace. Yet, in recent years many of the major economies are applying sanctions, raising tariffs and actively pursuing industrial policies. This applied economics class will look at what the economic models say about such policies, and it will examine the evidence on what the costs and benefits are – across and within countries. What are the conditions that are more likely to lead to success or desired outcomes? Is the use of sanctions likely to erode the role of the US dollar? What is evidence on the extent of re-shoring/friend-shoring? Will countries be more or less insulated from shocks? What are the implications for convergence or for lower income countries to catch up? The course will look at specific country examples, including Russia, Iran, South Africa, Cuba, South Korea, Brazil and Rwanda. It will also examine the impacts of US policies such as the IRA and CHIPS and Science Act, and the implications for economic relations with China as well as for other important allies and trade partners such as the EU and Japan. This class aims to provide frameworks, informed by evidence, on how to think about the what is at stake, what is desirable and what is feasible in these important policy debates.