2 / 16
2
Interview with Professor Ralph Ossa
Professor Ossa, you were appointed to the Profes-
sorship of Economics of Globalization and Emerg-
ing Markets, endowed by the UBS Center. Which
economic topics fascinate you?
Ralph Ossa:
I am interested in all policy-relevant
topics, particularly pertaining to international
trade. At the moment, I think a lot about what I
call “unconventional trade policy,” which is trade
policy that goes beyond classic tariff policy. For
example, international tax competition was just a
big topic in Switzerland surrounding a referendum
on corporate tax reform.
One of your current research projects focuses on
gains from trade liberalization, looking at the
Canada-U.S. Free Trade Agreement (CUSFTA).
What is this project about?
In this project, we challenge the way economists
think about the gains from international trade.
Most economists argue that a central benefit of
trade liberalization is that consumers obtain access
to a wider range of imported goods. For example,
trade liberalization might allow them to buy Swiss
chocolate even if they do not live in Switzerland,
which then increases their utility. The main point of
our paper is that these import variety gains are just
part of the story and are typically counteracted by
contemporaneous domestic variety losses. The issue
is simply that trade liberalization also tends to drive
domestic firms out of production, which means that
domestic consumers can then no longer purchase
the goods these firms make.
What are the main new insights from this
research?
Looking at the Canada-U.S. Free Trade Agreement,
we estimate that domestic variety losses actually
outweighed import variety gains for the Canadian
economy, thereby challenging the conventional
wisdom in the field. Having said this, we also show
that Canada still gained from the Canada-U.S. Free
Trade Agreement overall simply because it also
caused a significant reduction in the prices of im-
ported goods.
If you had not become an economist, what career
would you have chosen?
I always wanted to be a professor; I was just debat-
ing the field in which to give it a shot. The runner-
up choice was physics, and I almost switched to the
ETH Zurich after two years of undergraduate
business and economics studies in Germany. But I
am glad I stuck with economics because I am ulti-
mately more interested in social science questions.
The UBS Center aims to foster a closer dialogue
between policymakers, business leaders, and the
public at large. Being a member of the Center,
what is the main message you would like to con-
vey?
Academic economists are better than their reputa-
tion and can make valuable contributions to policy
debates. Most of them that I have met do not have
ideological agendas but are true scholars trying to
make sense of the world. I think this is the most
important message in times when experts are in-
creasingly frowned upon.
Ralph Ossa
was appointed to the Professorship in
Economics of Globalization and Emerging Markets,
endowed by the UBS Center. He joined the
University of Zurich at the beginning of this year.
Prior to moving to Zurich, he was Associate
Professor at the University of Chicago Booth
School of Business. He holds a PhD in Economics
from the London School of Economics.
His research focuses on international trade,
economic geography, and economic development.
Research
New Researchers