COVID-19: Fiscal and Trade Policy

For my undergraduate seminar research, I wanted to somehow assess the effects of restrictive trade policies. Through brainstorming, I settled on the initial research question: looking at the first wave of COVID-19, how did different government responses toward trade restrictions affect how fast their economy recovered? Assessing the abundant literature on policy responses to the pandemic, I found that the literature overwhelmingly focused on health policy and largely neglected economic responses. From there, I decided to incorporate fiscal policy into my research since it significantly affects GDP growth, and I wanted to assess how quickly governments recovered to pre-pandemic economic growth rates. So, my final research question was: how did different fiscal and trade policy responses to COVID-19 affect economic recovery?

I chose to focus on the United States, the European Union, and China because they are by far the three largest economies in the world. These economies account for roughly 45% of all international trade and thus have the most impact on the global economy. By comparing the strategies and outcomes of these three economies, my goal was to draw a conclusion about which economic policies generated better economic recovery.