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TPP: Maybe Not So Horrible

Summary:
From The Hill: President Trump on Thursday instructed top administration officials to explore re-entering the Trans-Pacific Partnership (TPP) — a trade pact he pulled the U.S. out of last year while calling it a “disaster.” With this whipsaw of trade policy announcements, is it any wonder that economic policy uncertainty is rising? As measured by the Baker, Bloom and Davis index: Figure 1: Daily EPU index as of April 12 (blue), and 7 day centered moving average (bold red). Source: policyuncertainty.com, and author’s calculations. A longer term perspective on economic policy uncertainty is shown in this post. And of course, most of us knew it wasn’t so horrible at all, back when we had a chance to influence the nature of TPP. Update, 8:15PM Pacific 4/13: Reader Ed Hanson asserts that EPU

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From The Hill:

President Trump on Thursday instructed top administration officials to explore re-entering the Trans-Pacific Partnership (TPP) — a trade pact he pulled the U.S. out of last year while calling it a “disaster.”

With this whipsaw of trade policy announcements, is it any wonder that economic policy uncertainty is rising? As measured by the Baker, Bloom and Davis index:

TPP: Maybe Not So Horrible
Figure 1: Daily EPU index as of April 12 (blue), and 7 day centered moving average (bold red). Source: policyuncertainty.com, and author’s calculations.

A longer term perspective on economic policy uncertainty is shown in this post.

And of course, most of us knew it wasn’t so horrible at all, back when we had a chance to influence the nature of TPP.

Update, 8:15PM Pacific 4/13: Reader Ed Hanson asserts that EPU is rising for most countries. I plot below the monthly indices; I honestly don’t see what he’s claiming.


Figure 2:

Menzie Chinn
He is Professor of Public Affairs and Economics at the University of Wisconsin, Madison

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