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New publication in the Review of World Economics [15.03.22]
The paper "Trade and Welfare Effects of a Potential Free Trade Agreement between Japan and the United States" by Dr. Timo Walter has been accepted for publication by the Review of World Economics.
In the paper, Dr. Timo Walter addresses the trade and welfare implications of a bilateral trade agreement between the U.S. and Japan. In 2019, the two countries signed a "stage one" trade agreement, with the U.S.-Japan Trade Agreement (USJTA) and the U.S.-Japan Digital Trade Agreement as two small trade agreements. A comprehensive bilateral free trade agreement (FTA) is currently under discussion between Washington and Tokyo, with the U.S. government alternatively joining the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP).
The author simulates trade and welfare impacts for the USJTA and the U.S.-Japan Digital Trade Agreement, as well as for a deep bilateral FTA. In addition, he examines the welfare implications of the established CPTPP with the scenario of the U.S. or China joining CPTPP.
His findings show that Japan’s welfare increases by 0.3% and U.S. welfare increases by 0.14% as a result of the FTA. Welfare of both countries would increase if the U.S. entered CPTPP, with Japanese welfare being even higher if China acceded to CPTPP.
The Review of World Economics is an international, peer-reviewed journal devoted to the publication of high-quality articles covering a full range of topics in international economics, such as trade and trade policies, global supply chains.
A preliminary version of the paper is available as Hohenheim Discussion Papers in Business, Economics and Social Sciences 16-2018.