Category Archives: Gains From Trade

Solar Panel Wars Part II: WTO Rules Against US

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As previously covered in the blog (link), the WTO issued a ruling in the Solar Panel War. The verdict is that the US improperly imposed tariffs on Chinese steel and solar panels (link). The US had argued it had to impose tariffs to combat artificially low prices on products from India and China's state-subsidised industries. Dont hold your breath. The Solar Panel War is not over since the US can still appeal.

Who benefits in the US, in China/India and what does that mean for pollution and global welfare? Use all relevant trade theories to support your answer.  

Workers in China holding solar panels

Lost In The Shuffle

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While gains from trade usually generate increases in national incomes, they do produce winners and loosers. Most countries have government programs that are supposed to address this redistribution of income. In the US President Kennedy introduced the Trade Adjustment Assistance Program administered by the US department of labor. The DOL’s national statistics highlight that 57,000 (280,000) workers were covered in 2015 (2010) by the TAA at a cost of $$235 mil (575 mil). That is about $4000 ($2000) per worker – probably not enough to pay for retraining or any meaningful compensation for job losses. The state data is even more fascinating.