A hierarchic framework for the propagating impacts of the China-U.S. trade war on volume of Chinese containerized exports

Abstract

The China-U.S. trade war between the world's two largest economies has received increasing attention. Due to the existing interdependencies within economic sectors, the trade war could bring about ripple effects and cause more damaging impacts than intuitive thoughts. By integrating Inoperability Input-output Model (IIM) and Partial Least Squares Regression (PLSR), we developed a hierarchic IIM-PLSR framework in this study to unravel the ripple effects of the China-U.S. trade war on volume of Chinese containerized exports. The results show that the China-U.S. trade war will affect the operability and output value of not only the tariff-targeted industries but the other interdependent industries. Contrary to expectations, the results show that the China-U.S. Trade War have an insignificant influence on the volume of containerized exports. Even in the worst scenario, the reduction percentage of containerized exports due to China-U.S. trade war is only 0.335%. This study brings fresh insights to stakeholders in the port industry for the implementation of rational port planning policies.