Essays on trade, fiscal policy and gender equality

Abstract

Chapter 1 introduces a new data set containing daily trade policy statements issued by government agencies between 2007 and 2019. Entries are classified along several dimensions: the direction of the policy change, the stage of the reform, and the initiating country. I argue that combining this narrative information with stock market data allows to identify unanticipated trade policy shocks. Stock returns generated around statement releases vary by firms' trade exposure and provide timely signals on the sign and size of trade policy changes. Furthermore, US exporters' stocks only respond to official statements but not to trade-related tweets by Donald Trump, demonstrating the ability to filter out particularly noisy signals. Chapter 2 builds on Chapter 1 and analyzes the short- and medium-term effects of trade policy on the US economy. Estimating impulse response functions by local projections, we uncover interesting asymmetries and non-linearities depending on the sign and size of trade policy shocks. Moreover, firm investment, unemployment and consumption react more strongly to shocks caused by trade partners rather than by the US. In addition, we show that implementations elicit more significant responses than announcements. Uncertain about whether policymakers will follow through with announced policy changes, firms and households take a "wait and see" approach. Chapter 3 turns to a different topic. Men typically bear the brunt of recessions due to stronger cyclicality of their employment and wages relative to women's. We study whether fiscal policy may offset or worsen these asymmetries across genders. Using US micro-level data, we find that men are hurt or benefit less than women from increases in major government spending components. This result is largely driven by negative spillovers for men working in the private sector. Our analysis highlights that fiscal expansions cannot reconcile both policy goals: offsetting inequitable business cycle effects and closing gender gaps.