The USA–China trade confrontation has become a major concern for all the nations involved in international trade. The retaliatory trade policies taken by both of these major trading nations have generated widespread impact among the trading nations especially on the developing and emerging...

The chapter attempts to develop a micro-theoretic model to explain the genesis of trade war in light of the behavioral interdependence of two countries connected through international trade and, thereof, it analyses its welfare implication with respect to the countries at feud. In this regard,...