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Journal article
Trade Blocs and Trade Wars during the Interwar Period
David S. Jacks and Dennis Novy
July 2020
Paper No' :

Tags: commonwealth; distance; gravity; interwar period; trade bloc; trade wars

What precisely were the causes and consequences of the trade wars in the 1930s? Were there perhaps deeper forces at work in reorienting global trade prior to the outbreak of World War II? And what lessons may this particular historical episode provide for the present day? To answer these questions, we distinguish between long-run secular trends in the period from 1920 to 1939 related to the formation of trade blocs and short-run disruptions associated with the trade wars of the 1930s. We argue that the trade wars mainly served to intensify pre-existing efforts toward the formation of trade blocs which dated from at least 1920. More speculatively, we argue that the trade wars of the present day may serve a similar purpose as those in the 1930s, that is, the intensification of China- and US-centric trade blocs. © 2019 The Authors. Asian Economic Policy Review published by John Wiley & Sons Australia, Ltd on behalf of Japan Center for Economic Research