Wednesday, March 25, 2026 12:30 - 14:00

This event is both online and in person.

SAL 1.04, 1st Floor Conference Room, Sir Arthur Lewis Building, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH

Online participants are welcome:
Please sign up to our mailinglist (seminar_macroiep) to receive event updates and a link to the seminar online.

About this event

Tariff announcements made during the U.S.-China trade war had broad effects on financial variables. Announcements systematically decreased stock prices and raised nominal and real bond prices. We use a specific factors model to show that the welfare impact of the tariffs can be identified from the policy-induced movement in the present value of firm cash flows: a variable that can be estimated from financial data. Using this framework, we find that the U.S.-China trade war lowered U.S. welfare by three percent. We show that these cash flow movements can be further decomposed into market expectations about how tariffs affect current and future prices and productivity. Seen through the lens of our model, the market reactions to tariff announcements can be explained by expectations that tariffs lead to large, negative future price and TFP shocks that play an important role in dynamic, but not static, models.

Participants are expected to adhere to the CEP Events Code of Conduct.

Directions

This event will take place in SAL 1.04, 1st Floor Conference Room, Sir Arthur Lewis Building, LSE, 32 Lincoln's Inn Fields, London WC2A 3PH.

Online participants are welcome:
Please sign up to our mailinglist (seminar_macroiep) to receive event updates and a link to the seminar online.

The building is labelled SAL on the LSE campus map. You can also find us on Google Maps. For further information, go to contact us.

Trade and Urban Seminars are part of the CEP's Trade programme and Urban programme.