Abstract:

In this study, trade wars and potential macroeconomic impacts, which have become more and more common in recent periods, are examined through examples of the US, China and Mexico with an interdisciplinary approach. First of all, the theoretical framework of the study is associated with conservation and strategic foreign trade policy. In the first part of our work in this direction, a literary study on free and protective foreign policy theories and the basic tools of these policies was carried out. In the second part of the study, in the framework of the strategic foreign trade policy, the protective policies implemented by the countries, their basic tools and methods were evaluated. The conservative foreign trade policies have studied the new approaches emerging, especially after globalization, and the ways in which these approaches can increase prosperity by making profits through conservative policies in accordance with different goals. In the third and last part of the study, the trade wars that the United States is expected to launch with China and Mexico were analyzed in the framework of an example event study. The three main scenarios and misleading behaviors used in this analysis are the options for the U.S. to launch a unilateral trade war, the parties to conduct a mutual trade war, and the optimum balance implementation in line with the Nash balance. The most fundamental results of the study are that trade wars will not lead to any improvement of well-being, including the start-up party, but will generate substantial loss of well-being. It is also achieved that the side with a larger economy can make a relative profit in the trade war and the optimum balance provided by the Nash balance is a scenario that minimizes the total loss of well-being.

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