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Americans will rightly be suspicious when a think tank in Germany writes about tariff relief that benefits them. Of course, we should all be critical always – that's the first word in the term "critical thinking".
If a think tank from a non-tariffed country would write this piece, they risk getting tariffs tomorrow.
And would Americans trust a (US) think tank in the juristiction of the US government right now?
If you look at the decline in the Chinese producer price index, it doesn't seem like that is accurate.
Click to, say, 3 year view of https://ycharts.com/indicators/china_producer_price_index
Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
Many problems in the world would be solved if people actually read Economics 101.
Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
How could that possibly have not been the case. A tariff is no different from the cost of any input into the price of a finished good. There is some sense in which price increases are limited by supply and demand, but if the market won't pay for the production cost of the good, then the market will cease to provide that good. There are only two possible outcomes, long term -- either the price goes up, or the product…
Can the title be changed to match some of the content text (eg America’s Own Goal: Who Pays the Tariffs?) ‘US Americans’ makes it sound as if a distinction is being drawn between Americans inside and outside of the US or something
"US Americans" is routinely used to name "people in the US", since "Americans" is ambiguous, and "US citizens" is more restrictive and explicitly excludes residents that are not citizens.
Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
> "Foreign exporters absorb only about 4% of the tariff burden-the remaining 96% is passed through to US buyers."
so yeah, the exporter does pay some burden. it's not binary. indeed, tariff exports can be designed in a way to dial either direction. certainly, we could dial foreign exporters burden to 0% – and we could dial it back up to 4% (where we're currently at). but, 4% likely isn't a hard ceiling, either. Of course, the 4% number is an aggregate, not the blanket value across indidual goods (or services).
finally, the effect of tariffs is argued to be wealth transfer to the US Treasury. this is worth thinking harder about. but also, exports may change from whom goods are purchased. thus, it's a diplomatic policy, as well.
Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
No, it isn’t that simple. Who bears the most weight depends on the elasticity of the curve on each side. This is confirming demand is more inelastic, which causes it to bear the burden, but could have been the other way around.
> Event studies around discrete tariff shocks on Brazil (50%) and India (25–50%) confirm: export prices did not decline. Trade volumes collapsed instead. What if that was the intended result?
your question implies that the person in charge of tariffs has any idea of the effect of using them...
Isn't this literally economics 101? How did we ever even end up imagining that tariffs are somehow paid by the exporter??
No, it isn’t that simple. Who bears the most weight depends on the elasticity of the curve on each side. This is confirming demand is more inelastic, which causes it to bear the burden, but could have been the other way around.