Authors: Peter B. Dixon and Maureen T. Rimmer
President Obama's National Export Initiative is targeted at doubling U.S. exports between 2010 and 2015. We apply USAGE to quantify what the NEI would need to do to foreign import-demand curves and domestic export-supply curves to achieve this target. USAGE is a dynamic economy-wide model of the U.S. incorporating recession-relevant factor market specifications including excess capacity and wage/labor-demand elasticities that vary with the level of employment. In our central simulation, export-promotion policies compatible with the President's target reduce the cost of the current recession from about 70 million one-year jobs for the period 2008-2020 to 45 million jobs.
JEL classification: E17; C68; E62; E65; F16.
Keywords: Export promotion; National Export Initiative; U.S. recession; Factor-market specification; Excess capacity.
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