The Impact of the 2018 Tariffs on Prices and Welfare
By M. Amiti, S. Redding, David E. Weinstein. Journal of Economic Perspectives, 2019
611 citations recorded by the source corpus.
We examine conventional approaches to evaluating the economic impact of protectionist trade policies. We illustrate these conventional approaches by applying them to the tariffs introduced by the Trump administration during 2018. In the wake of this increase in trade protection, the United States experienced substantial increases in the prices of intermediates and final goods, dramatic changes to its supply-chain network, reductions in availability of imported varieties, and the complete pass-through of the tariffs into domestic prices of imported goods. Therefore, the full incidence of the tariffs has fallen on domestic consumers and importers so far, and our estimates imply a reduction in aggregate US real income of $1.4 billion per month by the end of 2018. We see similar patterns for foreign countries that have retaliated with their own tariffs against the United States, which suggests that the trade war has also reduced the real income of these other countries.
Subfields: Economics and Econometrics
View Paper: https://www.semanticscholar.org/paper/9a399dcc6d801db39c3b28aa37461fe190c3cad2
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Citations in the corpus
- The Heterogeneous Impact of Market Size on Innovation: Evidence from French Firm-Level Exports (2022, background): “1For a survey on the short-run costs of the 2018 trade war, see Amiti et al. (2019). 2In an influential study, Acemoglu and Linn (2004) measure the sector-wide innovation response of the pharmaceutical industry to changes in demand over time.”
- De-Globalisation? Global Value Chains in the Post-COVID-19 Age (2020, neutral): “…body of work seems to indicate that the increased trade barriers in Chart 12 and the retaliation they triggered from China, has harmed both U.S. consumers (see Amiti et al., 2019, Fajgelbaum et al., 2020) and also the U.S. manufacturing sector (see Flaanen et al., 2020, Handley et al., 2020).”