Some Global Effects of President Trump’s Economic Program

Icon of open book, ANU

The economic agenda of the Trump Administration, if implemented, will have large and
long-lasting impacts on the US and global economies. This paper uses a global
economic model to assess the consequences of President Trump’s likely economic
program on the world economy. The model has 17 major economies and regions each
with six sectors of production and trade as well as a capital goods producing sector. The
paper shows how President Trump’s economic policies affect the global economy
through trade and capital flows induced by increases in global interest rates. Using a
consistent global economic model shows the contradictions in the aims of the
President’s economic program particularly in the effects on the manufacturing sector. In
the medium-term the policies imply increased likelihood of trade protection ultimately
causing a recession.

Attachments