The following is an abstract of a new piece I have been working on with my colleague Professor Gary Knight. I hope you enjoy it and please feel free to leave your comments below.
Michael Czinkota, Georgetown University, Washington, DC, USA, firstname.lastname@example.org
Gary Knight*, Willamette University, Salem, OR, USA, email@example.com
We investigate the international marketing implications of the international trade policies of US Presidents Ronald Reagan (‘Reagan’) and Donald Trump (‘Trump’). Today, in international trade, tariffs are low, averaging about 3% in the advanced economies and 10%-15% in the emerging markets. The average tariff across all goods worldwide is about 6%, down from 18% in 1990. Meanwhile, world trade has increased consistently. China is now the most important trading partner of the US, providing both a huge market and supplying a great variety of products.
In the 1970s, a goods trade deficit emerged in the US and persists to the present day. In our research, we found that the administrations of both presidents sought to reduce the US trade deficit, and defend and enhance the international marketing performance of US firms. In the early phase of his administration, trade policy under Reagan was restrained but became more assertive. Reagan focused on the trade deficit with Japan and on enhancing international market opportunities for US firms. But Reagan’s policies fell short of their goals. Today, the US faces a much larger trade deficit, primarily with China. Trump adopted policy goals similar to those of Reagan. Trump’s approach has been more assertive. Like Reagan, however, Trump’s policies have fallen short of achieving the intended goals.
In this paper, we provided empirical background and discussed the policies and outcomes of the policies of Reagan and Trump. We highlighted implications for firms’ international marketing efforts and performance, and as well as directions for future research. We pointed to research opportunities for scholars. Research might investigate better, smarter trade policy, and examine benchmarking by reviewing various trade policy approaches, of the US and other nations, and then examining those successful in achieving intended goals. Scholars might seek to identify appropriate strategies and tactics for enhancing the performance, of nations and of firms.
Implications suggest that companies need to increase their competitive advantages in global trade. The US needs to increase its national competitive advantages by improving national factors of production and implementing smarter economic policies that promote US business. Public policymakers should emphasize investing in infrastructure, for example, in communications technologies that can increase the effectiveness of the management of firms’ value chain operations. Broadly, firm strategy and public policy should aim to improve performance on in the areas of entrepreneurship, innovation, and productivity, in order to make US companies more competitive in the global marketplace. An important research step will be the anticipated identification of trade policy shifts and the concurrent effects on business planning and policy development. Looking forward, the Biden administration will have to juggle its promise of bolstering domestic investment in infrastructure and US firms while also growing US importance within World Trade.
Keywords: International trade policy; International marketing; Tariffs; Protectionism; Public policy
References Available Upon Request