Essays on Trade and Fiscal Policy

Abstract

This dissertation consists of three chapters examining the economic effects of trade and fiscal policy. In the first chapter, I bring a new dynamic perspective to the cost-benefit analysis of tariffs, and show that temporary tariffs levied on an upstream good can have long-lasting effects on downstream industries. In the second chapter—coauthored with Miguel Acosta—we document a surprising and little-known feature hidden in the complexity of the U.S. tariff code: tariffs are systematically higher on lower-end versions of goods relative to their higher-end counterparts. We show that this pattern emerged in the 1930s and 40s and has persisted until today. In the third chapter—coauthored with Gernot Müller, Ernesto Pasten, Raphael Schoenle, and Michael Weber—we show the importance of accounting for the heterogeneous nature of government spending when analyzing its impacts on the economy. We establish several new facts about the heterogeneous nature of federal fiscal spending by analyzing the universe of federal procurement contracts, and show that taking these facts into account is important for understanding the fiscal transmission mechanism.