Protectionism: A professor from Rennes SB analyses the limits of the American model

Protectionism regularly returns to the centre of economic debate, particularly with Donald Trump’s recent re-election and his decisions on trade policy. In an opinion piece published in La Tribune, Stéphane Auray, professor at the Rennes School of Business, CREST-Ensai, analyses the long-term economic impacts of American protectionist policies with Aurélien Eyquem, professor at the University of Lausanne.

The authors explain that the customs barriers introduced to reduce the trade deficit and protect national industry actually have negative side effects such as higher prices for consumers, a loss of competitiveness for American companies, and a deterioration in international trade.

Their analysis, based on in-depth research, highlights the flaws in this strategy, particularly due to the impact on inflation and the ways in which foreign companies get around the measures.

Firstly, they point out that the US trade deficit cannot be analysed solely from the perspective of trade in goods. The attractiveness of American investments and the role of the dollar as a safe haven limit the effectiveness of protectionist measures to reduce this deficit.

In addition, the authors insist on the fact that the promise of massively recreating industrial jobs thanks to customs barriers is illusory, given the trends of automation and digitalisation of industry.

According to them, rather than locking itself into a protectionist logic, the United States would benefit from investing in innovation and training, which are more effective levers for strengthening its competitiveness in the long term while reducing growing inequalities.

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