We are organizing the third annual GCAP conference on international economics and finance, to take place in person at Columbia University in New York on October 17. For more information, see the call for papers.
The program of the International Economics and Geopolitics workshop at the NBER summer institute is out. Meeting will be live streamed. Organized by GCAP co-directors Matteo Maggiori and Jesse Schreger.
GCAP and the Stanford Business, Government, and Society Initiative will hold a JIE-GCAP-BGS Conference on Geoeconomics at Stanford GSB on February 27-28, 2026. See the call for papers.
Organized by Jesse Schreger (Columbia University), Jeff Frieden (Columbia University), Reka Juhasz (University of British Columbia), Carolin Pflueger (University of Chicago), and Christoph Trebesch (Kiel).
New paper on using Artificial Intelligence to measure the effect of tariffs, export controls, and sanctions on firms. Geoeconomic pressure—the use of existing economic relationships by governments to achieve geopolitical or economic ends—has become a prominent feature of global power dynamics. This paper introduces a methodology using large language models (LLMs) to systematically extract signals of geoeconomic pressure from large textual corpora. We analyze the ongoing trade war and update the draft at high frequency.
Visit our research page to learn more.
We have prepared a new paper for the 2025 AEA Papers and Proceedings, “The Political Economy of Geoeconomic Power.” Great powers are increasingly using their economic and financial strength for geopolitical aims. This rise of "geoeconomics" has the potential to reshape the international trade and financial system. This paper examines the role of domestic political economy forces in determining a government's ability to project geoeconomic power abroad. We also discuss the role that persuading or coercing foreign governments plays in projecting geoeconomic power around the world.
Visit our research page to learn more.
Our paper “Internationalizing like China” is now forthcoming in the American Economic Review. We investigate the foreign holdings of Renminbi bonds and provide a theoretical framework to understand China's strategy to internationalize its currency. For more details, read the paper or a non-technical brief.
Selected media coverage: Bloomberg | The Economist | Business Insider | Bloomberg
Economists at Stanford, Columbia and Yale used large language models to analyze hundreds of thousands of earnings calls and record how American firms responded to Trump’s tariff announcements. They found that companies were more than five times likelier to say tariffs hurt them than helped them.
“[Albert Hirschman] would not have been surprised by President Donald Trump’s tariffs or indeed China’s own attempts at economic coercion, which include export restrictions on vital inputs, such as rare earths. It is, therefore, a good time to revive the spirit of his inquiries, according to Christopher Clayton of Yale School of Management, Matteo Maggiori of Stanford University and Jesse Schreger of Columbia Business School. They are seeking to apply the modern toolkit of economics to geopolitics. The result is something they call “geoeconomics” (borrowing a term coined by Edward Luttwak, a historian and military strategist, in 1990). Whatever the subject is called, it is inescapable.”
“A group of economists at Stanford and Columbia have set up the so-called Global Capital Allocation Project (GCAP) to conduct research that ‘leverages recent advances in large language models to identify the areas of the global economy that are particularly vulnerable to geoeconomic pressure’. Their core thesis is that China today has hegemonic control of manufacturing (via its dominance of key supply chain nodes such as rare earth minerals) but the US has hegemonic control of finance (because of the dollar’s reserve currency status).
Hence one way to make sense of White House actions is that America is trying to undercut China’s industrial hegemony while also protecting its own financial dominance, and vice versa. Tech hegemony, in my view, is still being contested.
Such thinking not only explains US-China relations; it also sheds light on how other countries are reacting, since the priority for them now is to create ‘anti-coercion’ strategies, as the GCAP says."
“This episode of The Outthinking Investor discusses how investors can measure their portfolio’s exposure to geoeconomic shifts, which economies and sectors could benefit amid a realignment in supply chains, whether the US dollar can maintain its global dominance, and investment strategies that could potentially mitigate risk and capitalize on new opportunities.”
[Matteo Maggiori] “Sometimes you can get stuck in history-dependent outcomes, and this might give us a chance to rethink some of these institutions, make them work better, update them, and ultimately get to a better place."
“Experts on offshore finance have long viewed VIE structures as risky, particularly for retail investors and pension funds who may not realize that their holdings depend on the untested enforceability of complex contracts.
`They were clearly engineered on one end to fulfill a seeming miracle of formally stating to Chinese regulators that none of this is equity,’ says Matteo Maggiori, a finance professor at Stanford University. `And at the other end, under accepted international accounting principles, saying that because the contracts amount to the key characteristics of equity — control and the residual claims to the profit — they should be regarded as being equity.’”
“This is generally what happens when interest rates in the economy go up. ‘Everything that the firm or the private sector would contemplate doing gets a little bit harder to do,’ said Jesse Schreger, an associate professor at Columbia Business School… ‘The U.S. is coming into this higher interest rate environment with just a staggering amount of debt outstanding that has to be refinanced at these higher rates.’”
