US

Trade Balances

A typical country can increase its citizens’ welfare by enacting policies that would increase its trade surplus (or decrease its trade deficit).

Responses weighted by each expert's confidence

Participant University Vote Confidence Bio/Vote History
Acemoglu
Daron Acemoglu
MIT
Uncertain
5
Bio/Vote History
Consumption and investment smoothing is good. But often CA deficits support consumption booms that are unsustainable.
Alesina
Alberto Alesina
Harvard Did Not Answer Bio/Vote History
Altonji
Joseph Altonji
Yale
Uncertain
3
Bio/Vote History
Auerbach
Alan Auerbach
Berkeley
Disagree
7
Bio/Vote History
Autor
David Autor
MIT
Disagree
7
Bio/Vote History
Perhaps in the very short run, but not in equilibrium.
Baicker
Katherine Baicker
University of Chicago Did Not Answer Bio/Vote History
Banerjee
Abhijit Banerjee
MIT
Disagree
6
Bio/Vote History
There is no reason to think the relation is causal
Bertrand
Marianne Bertrand
Chicago
Agree
3
Bio/Vote History
Brunnermeier
Markus Brunnermeier
Princeton
Uncertain
7
Bio/Vote History
Depends on circumstances. To return to steady state, export growth model worked well for China, Asian Tigers and Germany after WW II.
Chetty
Raj Chetty
Harvard Did Not Answer Bio/Vote History
Chevalier
Judith Chevalier
Yale Did Not Answer Bio/Vote History
Currie
Janet Currie
Princeton Did Not Answer Bio/Vote History
Cutler
David Cutler
Harvard
Uncertain
5
Bio/Vote History
Deaton
Angus Deaton
Princeton
Disagree
2
Bio/Vote History
Duffie
Darrell Duffie
Stanford
Strongly Disagree
6
Bio/Vote History
There is no conceptual or empirical support for this. It depends on dynamics and discount rates.
Edlin
Aaron Edlin
Berkeley
Disagree
2
Bio/Vote History
Eichengreen
Barry Eichengreen
Berkeley
Strongly Disagree
10
Bio/Vote History
Einav
Liran Einav
Stanford
Disagree
5
Bio/Vote History
Fair
Ray Fair
Yale
Disagree
5
Bio/Vote History
Finkelstein
Amy Finkelstein
MIT
Disagree
4
Bio/Vote History
Goldberg
Pinelopi Goldberg
Yale Did Not Answer Bio/Vote History
Goolsbee
Austan Goolsbee
Chicago
Uncertain
5
Bio/Vote History
Greenstone
Michael Greenstone
University of Chicago Did Not Answer Bio/Vote History
Hall
Robert Hall
Stanford
Uncertain
6
Bio/Vote History
Focusing on trade is basically mercantilism. I take a global perspective, where trade always nets to zero, so this focus is meaningless.
Hart
Oliver Hart
Harvard
Strongly Disagree
10
Bio/Vote History
A trade surplus means a country is saving, a trade deficit that it is dis-saving. As with people each can make sense at different times.
Holmström
Bengt Holmström
MIT
Agree
7
Bio/Vote History
Depends on circustances. For small open economies and emerging economies an essential element of policy.
Hoxby
Caroline Hoxby
Stanford
Uncertain
8
Bio/Vote History
1st principles: neither surplus nor deficit necessarily welfare-enhance. SOME welfare-enhancing policies would raise surplus, however.
Hoynes
Hilary Hoynes
Berkeley
No Opinion
Bio/Vote History
Judd
Kenneth Judd
Stanford
Strongly Disagree
8
Bio/Vote History
The best way to increase welfare is to engage in good policies, not go after some mercantilist ideal.
Kaplan
Steven Kaplan
Chicago Booth
No Opinion
Bio/Vote History
Kashyap
Anil Kashyap
Chicago Booth
Strongly Disagree
10
Bio/Vote History
crazy assertion but plenty of people seem to believe this. to see the fallacy, note that banning imports would do it and would crush welfare
Klenow
Pete Klenow
Stanford
Strongly Disagree
8
Bio/Vote History
Levin
Jonathan Levin
Stanford
Uncertain
3
Bio/Vote History
In some cases, yes, for at least some citizens.
Maskin
Eric Maskin
Harvard Did Not Answer Bio/Vote History
Nordhaus
William Nordhaus
Yale
Strongly Disagree
9
Bio/Vote History
Trade surplus is symptom, not measure of welfare.
Saez
Emmanuel Saez
Berkeley
Uncertain
4
Bio/Vote History
Samuelson
Larry Samuelson
Yale
Disagree
6
Bio/Vote History
A surplus is often taken to indicate a healthy economy, but it is not obvious how producing more than it consume makes a country better off.
Scheinkman
José Scheinkman
Columbia University Did Not Answer Bio/Vote History
Schmalensee
Richard Schmalensee
MIT
Disagree
4
Bio/Vote History
Shapiro
Carl Shapiro
Berkeley
No Opinion
Bio/Vote History
Shimer
Robert Shimer
University of Chicago
Uncertain
3
Bio/Vote History
Thaler
Richard Thaler
Chicago Booth
No Opinion
Bio/Vote History
Seems like the right answer to this question is: it depends.
Udry
Christopher Udry
Northwestern
Disagree
6
Bio/Vote History
There may be policies that reduce trade deficits and increase welfare, but most policies *designed* to reduce deficits will reduce welfare.