Business Case Studies & Business Publications

The US–China Trade War: Deal or No Deal?

Yang, Dennis, Ha, ...

Technical Note

The US–China Trade War: Deal or No Deal?

Yang, Dennis; Ha, Jiming; Holtz, Paul; Yemen, Gerry

GEM-0175 | Published March 17, 2020 | 31 pages Technical Note

Collection: Darden School of Business

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The US–China trade war in 2019 led to major shifts in global trade and supply chains, highlighting the recent trend in deglobalization. This note discusses the patterns of international trade and capital flows across the two countries, determinants of trade imbalances, and the role of national savings, policies, institutions, and exchange rates. The material allows for an examination of several factors, including the broader context of tech competition between China and the United States. The note raises a series of questions around the uncertainty the trade war created, the impact of tariffs on both economies, and diverging views from the two sides on who is winning. The note has been successfully taught in second-year MBA classes and executive training programs on global economies and markets.

•To understand economic relationship and business strategy between the two largest economies in the world •To explore the causes and consequences of the trade war •To examine short-term and long-term strategic relationships •To discuss trends in deglobalization and geopolitical frictions