Title

United States-China Trade War and the Emergence of Global Covid-19 Pandemic

Document Type

Article

Publication Date

2020

Publication Title

International Economics

Abstract

This paper asserts that the retaliatory trade wars between the United States and China contributed to the emergence of the global COVID-19 pandemic because the trade wars hindered the collaboration, coordination, and transparent information sharing about infectious diseases that could have adverse effects on the global economy. The retaliatory trade wars between the two largest economies in the world turned the symmetric information sharing about global infectious diseases to asymmetric information sharing, thus the inability to prepare for the emergence of the current global COVID-19 pandemic shock. In the first two decades of the 21st century, the World Health Organization (WHO) in collaboration, coordination, and transparent information sharing with global health care systems managed to curtail the outbreaks of the severe acute respiratory syndrome (SARS) in 2002-2003, H1N1 in 2009, Ebola in 2014, Zika in 2015, Dengue in 2016, and other deadly infectious diseases. We maintain that the symmetric information sharing enabled the WHO and the other global health care systems to build the firewall against these deadly infectious diseases. The absence of collaboration, coordination, and the symmetric information sharing due to the trade wars forced both countries to resort to information distortions; therefore, the inability to prepare for the global COVID-19 pandemic. Using conceptual economics, we show that the confluence of the retaliatory trade wars and COVID-19 pandemic has significant negative ramifications on economies worldwide.

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