Dennis Novy

Graph showing the share of transactions invoiced in renminbi and the share of value invoiced in renminbi for imports from China to Argentina from January 2022 to June 2024. The US dollar has traditionally dominated the invoicing of international trade. But could other currencies one day replace it? This column examines a unique policy experiment in Argentina in 2023. Amid a severe dollar shortage, Argentina expanded its currency swap agreement with the People’s Bank of China. The share of imports from China invoiced in renminbi surged rapidly from zero to nearly 50%, displacing the US dollar. Using rich firm-level data on trade and banking, the authors show that lack of dollar availability and connections with a Chinese state-owned bank played a key role in promoting renminbi use.

Lack of dollar availability & connections with a Chinese state-owned bank played a key role in promoting #renminbi use in Argentina, with the share of imports from China invoiced in renminbi having surged from zero to nearly 50% in 2023.
Felipe Benguria, Dennis Novy
cepr.org/voxeu/column...
#EconSky

The battle for trade currency dominance: The dollar vs the renminbi in Argentina The US dollar has traditionally dominated the invoicing of international trade. But could other currencies one day replace it? This column examines a unique policy experiment in Argentina in 2023. Amid a severe dollar shortage, Argentina expanded its currency swap agreement with the People’s Bank of China. The share of imports from China invoiced in renminbi surged rapidly from zero to nearly 50%, displacing the US dollar. Using rich firm-level data on trade and banking, the authors show that lack of dollar availability and connections with a Chinese state-owned bank played a key role in promoting renminbi use.

Felipe Benguria and @dennisnovy.bsky.social on a unique policy experiment in Argentina.

cepr.org/voxeu/colum...

Call for papers

The CEP/LSE – Warwick Junior Trade Workshop will bring together PhD students in the field of international economics for job market paper presentations and discussions. @warwickecon.bsky.social @cep-lse.bsky.social

Submit papers by 27 July.

More ➡️ cep.lse.ac.uk/_new/events/...

Graph showing the shares of US goods imports from China and from Mexico in total US goods imports between 2010 and 2023. There is a red line that marks the start of the trade war in 2018, which is then followed by a drop in imports from China and a smaller increase in imports from Mexico. In 2018 and 2019, the US administration hiked tariffs on imports from China. This column shows that imports from Mexico partly filled the gap, leading to an export and employment surge in Mexico. Using highly disaggregated firm-level data on Mexican exports, combined with detailed employer-employee data, the authors find that US tariffs against China resulted in more employment and higher wages in the Mexican export sector, especially for lower-wage workers such as female, unskilled, and younger employees. The effects were concentrated in technology and skill-intensive manufacturing industries such as chemicals and automotives.

In 2018-2019, the #US administration hiked #tariffs on imports from #China. As a result, imports from #Mexico partly filled the gap, leading to an export and #employment surge in Mexico.
Natalie Chen, Dennis Novy, Diego Solórzano
cepr.org/voxeu/column...
#EconSky

The New Global Economy: Trade Wars and De-dollarisation?

Submissions deadline: 1 July 2025

Conference dates: 27-28 September 2025

Location: Cambridge UK

“Tariffs and Their Implications”

Free to join on 30 April

With

- Teresa Fort
- Jacob J. Lew
- David E. Weinstein
- Jeffry Frieden
- Dennis Novy

@columbiaigp.bsky.social
@columbiauniversity.bsky.social
@columbiasipa.bsky.social

Trade and Uncertainty Abstract. We offer a new explanation as to why international trade is so volatile in response to economic shocks. Our approach combines the idea of uncertainty shocks with international trade. Firms o...

What is the effect of heightened uncertainty on international trade?

➡️ Trade reacts more strongly than domestic economic activity.

Our research:

Trade and Uncertainty | The Review of Economics and Statistics | MIT Press ⁦‪@restatjournal‬⁩.bsky.social

direct.mit.edu/rest/article...

Great to see our recent PhD student Edoardo Tolva’s paper on the ISoT program.

Joint work with Cristoforoni, Errico and Rodari on “Oligopolies in Trade and Transportation” with great micro data from Chile

@etolva.bsky.social @warwickecon.bsky.social
@jintlecon.bsky.social

New AEJ:Macro paper with Breinlich, Leromain & @dennisnovy.bsky.social

Tests an old Paul Krugman idea: does import protection promote exports through industry-level scale economies?

Find scale economies do operate, but there is also an offsetting supply chain effect 1/

bsky.app/profile/aeaj...

Import Liberalization as Export Destruction? Evidence from the United States (Forthcoming Article) - In trade models with scale economies import liberalization reduces exports within industries by shrinking real market potential. We find this export destruction mechanism reduc...

AEJ: Macroeconomics: "Import Liberalization as Export Destruction? Evidence from the United States" by Holger Breinlich, Elsa Leromain, Dennis Novy, and Thomas Sampson. www.aeaweb.org/articles?id=...

🚩 Call for papers 🚩

2nd Midlands Trade & Investment Network ECR Conference

Birmingham, United Kingdom
25 June 2025

t.co/tHORzmixdI

Avinash Dixit says:

Victor Norman: A pioneer of trade theory Victor Norman, a prominent Norwegian economist and leading figure in international economics passed away last year.

New trade theory: Victor Norman, Avinash Dixit, and how it started at Warwick University in 1976
⁦
@cage_warwick @warwickecon
⁩
@BaldwinRE @PrincetonEcon

warwick.ac.uk/fac/soc/econ...

Trump and the history of tariffs. With Doug Irwin Podcast Episode · The Economics Show · 20/01/2025 · 43m

Great interview:

@douglasirwin.bsky.social on US trade policy — past and present

By @alanbeattie.bsky.social

podcasts.apple.com/gb/podcast/t...

📰Can Europe find its way through the woods in 2025?
Dennis Novy @dennisnovy.bsky.social discusses the challenges for the German economy and its industries in an interview for The New European archive.ph/0XcSv

New research. How has Brexit affected UK trade?

We find TCA reduced goods exports by 6.4%, imports by 3.1%

Smaller firms hardest hit. Around 16,400 firms stopped exporting to the EU entirely

But larger firms' exports unaffected, contributing to relatively small fall in overall trade 1/

Brexit hit to UK trade less than predicted, says study Larger companies have adapted to red tape at the border, according to London School of Economics research

Nice FT write-up of our new Brexit & trade paper by the always excellent @pmdfoster.bsky.social

Rightly notes that our findings (goods exports⬇️6.4% due to TCA, imports ⬇️3.1%) suggest OBR's forecast (long-run trade ⬇️15%) may be an over-estimate of the impact of Brexit

on.ft.com/4iK8esS

Hey #EconSky! I am on the market this year.

Check my profile for the thread with the paper!

You can find all the other great candidates from Warwick at @warwickecon.bsky.social