IDEAS home Printed from https://ideas.repec.org/p/bfr/banfra/319.html
   My bibliography  Save this paper

Protectionist Responses to the Crisis: Global Trends and Implications

Author

Listed:
  • Bussière, M.
  • Pérez-Barreiro, E.
  • Straub, R.
  • Taglioni, D.

Abstract

In this paper we take a systematic look at recent trends in global protectionism and at the potential implications of a protectionist backlash for economic growth, using results from the recent economic literature and new model simulations. We find that there has so far been a moderate increase in actual protectionist measures to restrict trade through tariff and non-tariff barriers. At the same time, evidence from surveys shows that public pressure for more economic protection has been mounting since the mid-2000s, and has possibly intensified since the start of the financial crisis. However, no World Trade Organization (WTO) member has retreated into widespread trade restrictions or protectionism to date. Our model-based simulations suggest that the impairment of the global flow of trade would hamper the recovery from the crisis, as well as the long-term growth of the global economy. At the same time, it is unlikely that protectionism would help to correct existing current account imbalances. Moreover, the countries implementing protectionist measures should expect a deterioration of their international competitiveness, which would further affect the potential for longer-term real GDP growth.

Suggested Citation

  • Bussière, M. & Pérez-Barreiro, E. & Straub, R. & Taglioni, D., 2011. "Protectionist Responses to the Crisis: Global Trends and Implications," Working papers 319, Banque de France.
    • Handle: RePEc:bfr:banfra:319
    as

    Download full text from publisher

    File URL: https://publications.banque-france.fr/sites/default/files/medias/documents/working-paper_319_2011.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Amelia Santos-Paulino & A. P. Thirlwall, 2004. "The impact of trade liberalisation on exports, imports and the balance of payments of developing countries," Economic Journal, Royal Economic Society, vol. 114(493), pages 50-72, February.
    2. Sebastian Edwards, 2007. "Capital Controls, Sudden Stops, and Current Account Reversals," NBER Chapters, in: Capital Controls and Capital Flows in Emerging Economies: Policies, Practices, and Consequences, pages 73-120, National Bureau of Economic Research, Inc.
    3. Eichengreen, Barry & Irwin, Douglas A., 2010. "The Slide to Protectionism in the Great Depression: Who Succumbed and Why?," The Journal of Economic History, Cambridge University Press, vol. 70(4), pages 871-897, December.
    4. K. Barhoumi & S. Benk & R. Cristadoro & A. Den Reijer & A. Jakaitiene & P. Jelonek & A. Rua & K. Ruth & C. Van Nieuwenhuyze & G. Rünstler, 2008. "Short-term forecasting of GDP using large monthly datasets – A pseudo real-time forecast evaluation exercise," Working Paper Research 133, National Bank of Belgium.
    5. Ramon Gomez-Salvador & Nadine Leiner-Killinger, 2008. "An analysis of youth unemployment in the euro area," Occasional Paper Series 89, European Central Bank.
    6. Chinn, Menzie D. & Ito, Hiro, 2006. "What matters for financial development? Capital controls, institutions, and interactions," Journal of Development Economics, Elsevier, vol. 81(1), pages 163-192, October.
    7. Philippe Moutot & Alexander Jung & Francesco Paolo Mongelli, 2008. "The working of the eurosystem - monetary policy preparations and decision-making – selected issues," Occasional Paper Series 79, European Central Bank.
    8. Roland Beck & Michael Fidora, 2008. "The impact of sovereign wealth funds on global financial markets," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(6), pages 349-358, November.
    9. Philippa Dee & Kevin Hanslow & Tien Phamduc, 2013. "Measuring the Cost of Barriers to Trade in Services," World Scientific Book Chapters, in: Services Trade Reform Making Sense of It, chapter 5, pages 97-123, World Scientific Publishing Co. Pte. Ltd..
    10. Ito, Takatoshi & Krueger, Anne O. (ed.), 2003. "Trade in Services in the Asia-Pacific Region," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226386775.
    11. Chen, Natalie & Novy, Dennis, 2008. "International Trade Integration: A Disaggregated Approach," CEPR Discussion Papers 7103, C.E.P.R. Discussion Papers.
    12. The Eurosystem Household Finance and Consumption Network, 2009. "Survey data on household finance and consumption - research summary and policy use," Occasional Paper Series 100, European Central Bank.
    13. Lorenzo Cappiello & Gianluigi Ferrucci, 2008. "The sustainability of China's exchange rate policy and capital account liberalisation," Occasional Paper Series 82, European Central Bank.
    14. Malin Andersson & Arne Gieseck & Beatrice Pierluigi & Nick Vidalis, 2008. "Wage growth dispersion across the euro area countries - some stylised facts," Occasional Paper Series 90, European Central Bank.
    15. Trabandt, Mathias & Attinasi, Maria Grazia & Stark, Jürgen & Lalouette, Laure & Nickel, Christiane & Valenta, Vilém & van Riet, Ad & Leiner-Killinger, Nadine & Afonso, António & Warmedinger, Thomas & , 2010. "Euro area fiscal policies and the crisis," Occasional Paper Series 109, European Central Bank.
    16. Richard E. Baldwin, 2011. "Multilateralising Regionalism: Spaghetti Bowls as Building Blocks on the Path to Global Free Trade," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume I, chapter 2, Edward Elgar Publishing.
    17. Ioannou, Demosthenes & Ferdinandusse, Marien & Lo Duca, Marco & Coussens, Wouter, 2008. "Benchmarking the Lisbon Strategy," Occasional Paper Series 85, European Central Bank.
    18. Cole, Harold L. & Obstfeld, Maurice, 1991. "Commodity trade and international risk sharing : How much do financial markets matter?," Journal of Monetary Economics, Elsevier, vol. 28(1), pages 3-24, August.
    19. Hubrich, Kirstin & Karlsson, Tohmas, 2010. "Trade consistency in the context of the Eurosystem projection exercises - an overview," Occasional Paper Series 108, European Central Bank.
    20. Coenen, Günter & McAdam, Peter & Straub, Roland, 2008. "Tax reform and labour-market performance in the euro area: A simulation-based analysis using the New Area-Wide Model," Journal of Economic Dynamics and Control, Elsevier, vol. 32(8), pages 2543-2583, August.
    21. di Mauro, Filippo & Kaufmann, Robert K. & Karadeloglou, Pavlos, 2008. "Will oil prices decline over the long run?," Occasional Paper Series 98, European Central Bank.
    22. Dennis P. Quinn, 2003. "Capital account liberalization and financial globalization, 1890-1999: a synoptic view," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 8(3), pages 189-204.
    23. Thierry Bracke & Matthieu Bussière & Michael Fidora & Roland Straub, 2010. "A Framework for Assessing Global Imbalances," The World Economy, Wiley Blackwell, vol. 33(9), pages 1140-1174, September.
    24. Paul Conway & Giuseppe Nicoletti, 2006. "Product Market Regulation in the Non-Manufacturing Sectors of OECD Countries: Measurement and Highlights," OECD Economics Department Working Papers 530, OECD Publishing.
    25. Michael Sturm & Jan Strasky & Petra Adolf & Dominik Peschel, 2008. "The Gulf Cooperation Council countries – economic structures, recent developments and role in the global economy," Occasional Paper Series 92, European Central Bank.
    26. Gómez-Salvador, Ramón & Leiner-Killinger, Nadine, 2008. "An analysis of youth unemployment in the euro area," Occasional Paper Series 89, European Central Bank.
    27. K. H. O'Rourke & R. Sinnott, 2001. "The Determinants of Individual Trade Policy Preferences: International Survey Evidence," Trinity Economics Papers 200110, Trinity College Dublin, Department of Economics.
    28. Ettore Dorrucci & Alexis Meyer-Cirkel & Daniel Santabárbara, 2009. "Domestic Financial Development in Emerging Economies: Evidence and Implications," Occasional Paper Series 102, European Central Bank.
    29. Philippe Moutot & Giovanni Vitale, 2009. "Monetary policy strategy in a global environment," Globalization Institute Working Papers 29, Federal Reserve Bank of Dallas.
    30. Mayerlen, Frank & Sola, Pierre & Be Duc, Louis, 2008. "The monetary presentation of the euro area balance of payments," Occasional Paper Series 96, European Central Bank.
    31. Marc J. Melitz & Giancarlo I. P. Ottaviano, 2021. "Market Size, Trade, and Productivity," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 4, pages 87-108, World Scientific Publishing Co. Pte. Ltd..
    32. Ottaviano, Gianmarco I.P. & Taglioni, Daria & di Mauro, Filippo, 2007. "Deeper, wider and more competitive? Monetary integration, Eastern enlargement and competitiveness in the European Union," Working Paper Series 847, European Central Bank.
    33. Louis Bê Duc & Gwenaël Le Breton, 2009. "Flow-of-funds analysis at the ECB – framework and applications," Occasional Paper Series 105, European Central Bank.
    34. Vitale, Giovanni & Moutot, Philippe, 2009. "Monetary policy strategy in a global environment," Occasional Paper Series 106, European Central Bank.
    35. Takatoshi Ito & Anne O. Krueger, 2003. "Trade in Services in the Asia-Pacific Region," NBER Books, National Bureau of Economic Research, Inc, number ito_03-1.
    36. Mody, Ashoka & Murshid, Antu Panini, 2005. "Growing up with capital flows," Journal of International Economics, Elsevier, vol. 65(1), pages 249-266, January.
    37. Marc J. Melitz & Gianmarco I. P. Ottaviano, 2008. "Market Size, Trade, and Productivity (DOI:10.111/j.1467-937x.2007.00463.x)," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 75(3), pages 985-985.
    38. K. Barhoumi & S. Benk & R. Cristadoro & A. Den Reijer & A. Jakaitiene & P. Jelonek & A. Rua & K. Ruth & C. Van Nieuwenhuyze & G. Rünstler, 2008. "Short-term forecasting of GDP using large monthly datasets – A pseudo real-time forecast evaluation exercise," Working Paper Research 133, National Bank of Belgium.
    39. Matthieu Bussière & Emilia Pérez‐Barreiro & Roland Straub & Daria Taglioni, 2011. "Protectionist Responses to the Crisis: Global Trends and Implications," The World Economy, Wiley Blackwell, vol. 34, pages 826-852, May.
    40. Antoine Bouët & Yvan Decreux & Lionel Fontagné & Sébastien Jean & David Laborde, 2008. "Assessing Applied Protection across the World," Review of International Economics, Wiley Blackwell, vol. 16(5), pages 850-863, November.
    41. Thierry Bracke & Matthieu Bussière & Michael Fidora & Roland Straub, 2008. "A framework for assessing global imbalances," Occasional Paper Series 78, European Central Bank.
    42. Pierluigi, Beatrice & Vidalis, Nick & Andersson, Malin & Gieseck, Arne, 2008. "Wage growth dispersion across the euro area countries: some stylised facts," Occasional Paper Series 90, European Central Bank.
    43. Sturm, Michael & Adolf, Petra & Peschel, Dominik & Stráský, Jan, 2008. "The Gulf Cooperation Council countries: economic structures, recent developments and role in the global economy," Occasional Paper Series 92, European Central Bank.
    44. Irina Bunda, 2007. "The Changing Role of the Exchange Rate in a Globalised Economy," Post-Print halshs-00372820, HAL.
    45. Moutot, Philippe & Jung, Alexander & Mongelli, Francesco Paolo, 2008. "The working of the eurosystem: monetary policy preparations and decision-making - selected issues," Occasional Paper Series 79, European Central Bank.
    46. Baybars Karacaovali & Nuno Limão, 2018. "The clash of liberalizations: Preferential vs. multilateral trade liberalization in the European Union," World Scientific Book Chapters, in: Policy Externalities and International Trade Agreements, chapter 14, pages 373-401, World Scientific Publishing Co. Pte. Ltd..
    47. Frank Smets & Raf Wouters, 2003. "An Estimated Dynamic Stochastic General Equilibrium Model of the Euro Area," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1123-1175, September.
    48. De Santis, Roberto A. & Cappiello, Lorenzo & Baltzer, Markus & Manganelli, Simone, 2008. "Measuring financial integration in new EU Member States," Occasional Paper Series 81, European Central Bank.
    49. Jacques Miniane, 2004. "A New Set of Measures on Capital Account Restrictions," IMF Staff Papers, Palgrave Macmillan, vol. 51(2), pages 1-4.
    50. Amelia Santos-Paulino & A.P. Thirlwall, 2004. "Trade Liberalisation And Economic Performance In Developing Countries - Introduction," Economic Journal, Royal Economic Society, vol. 114(493), pages 1-3, February.
    51. Straub, Roland & Jacquinot, Pascal, 2008. "Globalisation and the euro area: simulation based analysis using the New Area Wide Model," Working Paper Series 907, European Central Bank.
    52. Michael Sturm & François Gurtner & Juan Gonzalez Alegre, 2009. "Fiscal policy challenges in oil-exporting countries – a review of key issues," Occasional Paper Series 104, European Central Bank.
    53. Markus Baltzer & Lorenzo Cappiello & Roberto A. De Santis & Simone Manganelli, 2008. "Measuring financial integration in new EU member states," Occasional Paper Series 81, European Central Bank.
    54. Cappiello, Lorenzo & Ferrucci, Gianluigi, 2008. "The sustainability of China's exchange rate policy and capital account liberalisation," Occasional Paper Series 82, European Central Bank.
    55. Louis Be Duc & Frank Mayerlen & Pierre Sola, 2008. "The monetary presentation of the euro area balance of payments," Occasional Paper Series 96, European Central Bank.
    56. Raymond Ritter, 2009. "Transnational governance in global finance - the principles for stable capital flows and fair debt restructuring in emerging markets," Occasional Paper Series 103, European Central Bank.
    57. Robert Kaufmann & Pavlos Karadeloglou & Filippo di Mauro, 2008. "Will oil prices decline over the long run?," Occasional Paper Series 98, European Central Bank.
    58. Sturm, Michael & Gurtner, François & González Alegre, Juan, 2009. "Fiscal policy challenges in oil-exporting countries: a review of key issues," Occasional Paper Series 104, European Central Bank.
    59. Philippe Moutot & Giovanni Vitale, 2009. "Monetary policy strategy in a global environment," Occasional Paper Series 106, European Central Bank.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Trabandt, Mathias & Attinasi, Maria Grazia & Stark, Jürgen & Lalouette, Laure & Nickel, Christiane & Valenta, Vilém & van Riet, Ad & Leiner-Killinger, Nadine & Afonso, António & Warmedinger, Thomas & , 2010. "Euro area fiscal policies and the crisis," Occasional Paper Series 109, European Central Bank.
    2. Hubrich, Kirstin & Karlsson, Tohmas, 2010. "Trade consistency in the context of the Eurosystem projection exercises - an overview," Occasional Paper Series 108, European Central Bank.
    3. Vitale, Giovanni & Moutot, Philippe, 2009. "Monetary policy strategy in a global environment," Occasional Paper Series 106, European Central Bank.
    4. Le Breton, Gwenaël & Be Duc, Louis, 2009. "Flow-of-funds analysis at the ECB: framework and applications," Occasional Paper Series 105, European Central Bank.
    5. Sturm, Michael & Gurtner, François & González Alegre, Juan, 2009. "Fiscal policy challenges in oil-exporting countries: a review of key issues," Occasional Paper Series 104, European Central Bank.
    6. Dorrucci, Ettore & Meyer-Cirkel, Alexis & Santabárbara, Daniel, 2009. "Domestic financial development in emerging economies: evidence and implications," Occasional Paper Series 102, European Central Bank.
    7. Ritter, Raymond, 2009. "Transnational governance in global finance: the principles for stable capital flows and fair debt restructuring in emerging markets," Occasional Paper Series 103, European Central Bank.
    8. Kennickell, Arthur & Fitzpatrick, Trevor & Ehrmann, Michael & Bonci, Riccardo & Museux, Jean-Marc & Honkkila, Juha & Vilmunen, Jouko & Herrala, Risto & Komprej, Irena & Jeran, Matjaž & Geršak, Uroš & , 2009. "Survey data on household finance and consumption: research summary and policy use," Occasional Paper Series 100, European Central Bank.
    9. Köhler-Ulbrich, Petra & Asimakopoulos, Yannis & Doyle, Nicola & Magono, Ruth & Zachary, Marie-Denise & Walko, Zoltan & Stoess, Elmar & Kok, Christoffer & Wagner, Karin & Valckx, Nico & Martínez Pagés,, 2009. "Housing finance in the euro area," Occasional Paper Series 101, European Central Bank.
    10. Poloni, Paolo & Agresti, Anna Maria & Baudino, Patrizia, 2008. "The ECB and IMF indicators for the macro-prudential analysis of the banking sector: a comparison of the two approaches," Occasional Paper Series 99, European Central Bank.
    11. Matthieu Bussière & Emilia Pérez‐Barreiro & Roland Straub & Daria Taglioni, 2011. "Protectionist Responses to the Crisis: Global Trends and Implications," The World Economy, Wiley Blackwell, vol. 34, pages 826-852, May.
    12. di Mauro, Filippo & Kaufmann, Robert K. & Karadeloglou, Pavlos, 2008. "Will oil prices decline over the long run?," Occasional Paper Series 98, European Central Bank.
    13. Filippo Di Mauro & Katrin Forster, "undated". "Globalisation and the competitiveness of the Euro area," Working Papers 5, Department of the Treasury, Ministry of the Economy and of Finance.
    14. Mayerlen, Frank & Sola, Pierre & Be Duc, Louis, 2008. "The monetary presentation of the euro area balance of payments," Occasional Paper Series 96, European Central Bank.
    15. Irina Bunda, 2007. "The Changing Role of the Exchange Rate in a Globalised Economy," Post-Print halshs-00372820, HAL.
    16. Winkler, Adalbert & Schokker, Hubert & Cocozza, Emidio & Herzberg, Valerie & Móré, Csaba & de Lannoy, Anthony & Gardó, Sándor & Chmielewski, Tomasz & Polgár, Éva Katalin & Habib, Maurizio Michael & Br, 2008. "Financial stability challenges in candidate countries managing the transition to deeper and more market-oriented financial systems," Occasional Paper Series 95, European Central Bank.
    17. Winkler, Adalbert & Polański, Zbigniew, 2008. "Russia, EU enlargement and the euro," Occasional Paper Series 93, European Central Bank.
    18. Sturm, Michael & Adolf, Petra & Peschel, Dominik & Stráský, Jan, 2008. "The Gulf Cooperation Council countries: economic structures, recent developments and role in the global economy," Occasional Paper Series 92, European Central Bank.
    19. Roland Beck & Michael Fidora, 2008. "The impact of sovereign wealth funds on global financial markets," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(6), pages 349-358, November.
    20. Cheun, Samuel & von Köppen-Mertes, Isabel & Weller, Benedict, 2009. "The collateral frameworks of the Eurosystem, the Federal Reserve System and the Bank of England and the financial market turmoil," Occasional Paper Series 107, European Central Bank.

    More about this item

    Keywords

    Protectionism ; trade ; financial crisis ; competitiveness ; World Trade Organization ; global imbalances.;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F53 - International Economics - - International Relations, National Security, and International Political Economy - - - International Agreements and Observance; International Organizations

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bfr:banfra:319. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael brassart (email available below). General contact details of provider: https://edirc.repec.org/data/bdfgvfr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.