Social and Behavioral Sciences Commons^™

A Measure Of Net Dependency Between The Economies Of The Usa And Its Major Trading Partners, Demetri Kantarelis

Economics, Finance and International Business Department Faculty Works

How interdependent are the economies of the USA and its trading partners and how does their net dependency evolve through time? In an attempt to answer these questions, a measure of bilateral net dependency between the USA and a trading partner nation (i) is proposed where net dependency is defined as the difference between USA’s dependency on i minus i’s dependency on the USA. Dependency between the US and a trading partner is measured as the ratio of trade between them over respective GDP plus imports from the trading partner with imports weighted by a degree of importance. Based on …