Protectionist Policies Threaten Global Trade, Prosperity Hinges on Multilateral Cooperation
This article looks at how trade imbalances affect countries' trade policies, focusing on whether they become more liberal or restrictive. The study checked 166 countries from 1998 to 2015. It found that when a country's trade balance gets better, it tends to open up its trade policies more. However, this effect is stronger in wealthier countries. Also, this openness happens only if there is a certain level of global trade policy openness. So, improving trade balance can lead countries to make their trade policies more open, especially when they are richer and global trade policies are also liberal.