TITLE:
A Study of the Chinese Retaliatory Tariffs on Tree Nuts Industry of California
AUTHORS:
Srini Konduru, Serhat Asci
KEYWORDS:
Chinese Retaliatory Tariffs, Tree Nuts, California, Input-Output Model, IMPLAN
JOURNAL NAME:
Theoretical Economics Letters,
Vol.9 No.8,
November
25,
2019
ABSTRACT: The objective of this study is to analyze the
economic impact of Chinese retaliatory tariffs on California’s economy using
the Input-Output model. Our model uses state
level Impact Analysis for Planning (IMPLAN) dataset along with data from
the United States Department of Agriculture-Foreign Agricultural Service (USDA-FAS),
California Department of Food and Agriculture, and County Ag Commissioner’s
reports. The analysis focuses on the implications of the retaliatory tariffs by
China in a scenario where the demand from other alternate export markets does
not change. The results show that the tree nut industry’s total output
decreases by about 14% and 10% in the short-run and long run period respectively when compared to the baseline scenario. The tree nut sector
would be employing about three thousand people lesser than the baseline
scenario in the short-run period and about two thousand people in long-run period, which is equivalent to 7% in
the short-run and 5% in the long-run period. The study concludes that it is
very important for the US and China to resolve their trade disputes as quickly
as possible in order to bring confidence not only to the tree nut industry in California, but hundreds of other industries
that have been impacted by this trade war.