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53 sats \ 0 replies \ @didiplaywell 7 Aug \ parent \ on: To tariff or not to tariff econ
The loss of business for exporters to the US would lower the prices they're able to charge.
There's a limit of viability, as any protectionist policy proved over and over, it will only cause imports to cease, not to become cheaper.
You're also assuming no viable domestic producers of substitutes.
I do am assuming viable domestic substitutes, that's one of the key factors in ensuring that tariffs will take effect only on the consumer side. That, together with decreasing and expensive imports, will cause local prices to rise. The US citizen will feel 100% of the tariffs one way or another.
The equilibrium increase from tariffs is going to be significantly less than you're describing.
Just wait and see.
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