Working Papers
Working Papers
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Abstract: A puzzling finding from the 2018-2019 trade war is that tariffs by large economies like the U.S. and China seemingly failed to lower pre-tariff prices. In this paper, I show that price reductions did occur but were concentrated in products where importers held significant bilateral market power. Because these products represent a large share of trade value, I estimate a 10% value-weighted average decline in import prices and a 38% pass-through rate for U.S. tariffs. The evidence on export prices is much weaker. As a result, the U.S. experienced a net positive terms-of-trade welfare gain.
"Trade Protection, Stock-Market Returns, and Welfare", with Mary Amiti, Matthieu Gomez, and David Weinstein, May 2026. Revise and Resubmit at the Journal of Finance.
Paper - NBER WP 28758 - NYFed Blog 1 - NYFed Blog 2
Media coverage: The Economist, Barron's, Quartz, Breitbart, Reuters, The Wall Street Journal, Forbes
Abstract: This paper develops a methodology to assess the expected impact of trade-policy announcements on aggregate welfare using financial market reactions. We use an infinite-horizon specific factors model of production to map the present discounted value of firm cash flows into aggregate welfare. We show that the policy-induced movement in the present value of firm cash flows—a variable that can be estimated from financial data—encapsulates the welfare impact of the tariffs. After applying our framework to the data, we find that the U.S.-China trade war lowered U.S. welfare by three percent.
Publications
Publications
"Quality Upgrading and Productivity Gains from Domestic Market Access Changes in India." Journal of Development Economics 182 (June 2026): 103830.
Paper - Published - Replication
Abstract: Taking advantage of a major highway project in India, I find that increased access to domestic high-income markets caused productivity gains and quality upgrading among local manufacturing plants. These findings extend existing results on the productivity and quality upgrading effects of exporting to high-income countries to a setting with much narrower income difference between the local and destination markets. However, increased access to domestic high-income markets was not as transformative as exporting. While wages increased, this was limited to production workers, who are typically less skilled than non-production workers. It also did not lead to more intensive use of non-production labor. Moreover, there were no effects on the prices of intermediate inputs or the share of imported inputs, suggesting that plants did not use higher-quality inputs. Despite some limitations, domestic high-income markets appear to be viable substitutes for foreign markets, which remain inaccessible to most firms in developing countries.
Inactive Papers
Inactive Papers
Abstract: This paper investigates whether regional exposure to the 2018 trade war tariffs influenced voting patterns in the U.S. House of Representatives elections. Using county-level data and accounting for input-output linkages, I find that higher protection offered by import tariffs led to increases in votes for Republican candidates. However, the overall impact was negative and economically small as gains from import tariffs on outputs were canceled by those on inputs. Moreover, there is no evidence that import tariff exposure induced party switching, as votes for Democratic candidates remained unaffected. Lastly, exposure to retaliatory tariffs had negligible electoral consequences. These findings highlight the limited political impact of trade war tariffs in the 2018 midterm elections.
"The Effect of the U.S.-China Trade War on U.S. Investment", with Mary Amiti and David Weinstein, May 2020.
NBER WP 27114
Media coverage: Bloomberg, Forbes, The Wall Street Journal, MarketWatch, New York Times
Abstract: We develop a new method of quantifying the impact of policy announcements on investment rates that makes use of stock market data. By estimating the effect of U.S.-China tariff announcements on aggregate returns and the differential returns of firms exposed to China, we identify their effect on treated and untreated firms. We show theoretically and empirically that estimates of policy-induced stock-market declines imply lower returns to capital, which lowers investment rates. We estimate that the tariff actions through 2018 and 2019 will lower the investment growth rate of listed U.S. companies by 1.9 percentage points by the end of 2020.
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