1. Trade war: US-China trade battle in charts (BBC): This article provides a nicesummary of the tariffs imposed during the U.S.-China trade war.2. Who Won the U.S.-China Trade War? (WSJ): This article is a recent opinionpiece from the Wall Street Journal and I think provides a quite representative summaryof the set of opinions that are frequently voiced in the context of the U.S. and Chinaon the trade war. Be aware though that many statements in this article are opinionsof politicians, so you might want to take them with a grain of salt. The second part ofthis article then discusses in more detail how the trade war has affected other countries.These articles are relevant for these questions. Please answer on paper. (3-4)

3. o The second article states that it is difficult to determine if the U.S. or China benefited from the trade war. However, it states that several other countries certainly profited from it. Which country in particular and why? We saw in class, that the U.S. is more productive both in the wheat and textile industry compared to China and this is actually true for the majority of industries. According to the Ricardian model, why are countries such as China or Vietnam still able to export so much to the U.S.? As implied by the second article, a concern regarding tariffs is that firms may simply produce in other low-wage countries instead, such as Vietnam, with the result that potentially only few jobs end up being created in the U.S.. For that reason, policy makers occasionally argue that such a tariff, to be effective, should be (1) levied on other low-wage countries as well and (2) ideally also be imposed by other countries, such as Japan or EU countries. Why would the second requirement matter, that is, why could it be a concern for the U.S. if firms from other countries can still source goods from China or Vietnam without having to pay a tarift? 3 Articles [20 points] This part asks you to read 2 articles about the U.S.-China trade war which started in 2018 and which resulted in an agreement in 2020 which was seen as a potential first step towards ending the current trade war between both countries. Read the following 2 articles, which are posted on Canvas, 1. Trade war: US-China trade battle in charts (BBC): This article provides a nice summary of the tariffs imposed during the U.S.-China trade war. 2. Who Won the U.S.-China Trade War? (WSJ): This article is a recent opinion piece from the Wall Street Journal and I think provides a quite representative summary of the set of opinions that are frequently voiced in the context of the U.S. and China on the trade war. Be aware though that many statements in this article are opinions of politicians, so you might want to take them with a grain of salt. The second part of this article then discusses in more detail how the trade war has affected other countries