Asymmetric trade liberalizations and current account dynamics

In this paper we present for the first-time quantitative evidence of the effect of U.S. power policy on the expansion of its export market from the late-19th century to the eve of World War II. U.S. imperial policies were expressed through annexation, dominion, and gunboat policies, as did other empires, and exports to these markets grew more than three times faster than the rest of the territories. Our most relevant contribution to the discussion that power plays a critical role in international trade is based on a new geographically extensive database with information on bilateral trade flows, market size, trade costs and variables that capture U.S. political and military power. We first estimate a gravity equation to see the relationship between our political variables and U.S exports and then we present causal evidence of the role of the colonies and protectorates in the expansion of U.S exports through an event study and the estimation of a generalized difference-in-differences model.

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Asymmetric trade liberalizations and current account dynamics

Abstract: seminar participants at several conferences and institutions for useful comments and suggestions. A special thank to the DC International Trade Workshop participants and to Global Affairs Canada. I thank the FRQFC (grant no. 184350) for financial support. Any errors are mine.

Cited by 2 publications

References 38 publications

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Power politics and the expansion of US exports, 1879–1938

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