Economy

2936 readers

1 users here now

Lemmy Community for economy, business, politics, stocks, bonds, product releases, IPOs, advice, news, investment, videos, predictions, government, money, politics, debate, current trends and more.

founded 3 years ago

MODERATORS

sv1sjp@lemmy.world

130

America's own goal: US citizens pay almost entirely for Trump’s tariffs, study finds (www.kielinstitut.de)

submitted 7 months ago by Sepia@mander.xyz to c/economy@lemmy.world

11 comments fedilink hide all child comments

Here is the study download: Americaʼs Own Goal: Who Pays the Tariffs? - (pdf)

Contrary to US government rhetoric, the cost of US import tariffs are not borne by foreign exporters. Instead, they hit the American economy itself. Foreign exporters absorb only about 4% of the tariff burden—the remaining 96% is passed through to US buyers.
Using shipment-level data covering over 25 million transactions valued at nearly $4 trillion, we find near-complete pass-through of tariffs to US import prices.
US customs revenue surged by approximately $200 billion in 2025—a tax paid almost entirely by Americans.
Event studies around discrete tariff shocks on Brazil (50%) and India (25–50%) confirm: export prices did not decline. Trade volumes collapsed instead.
Indian export customs data validates our findings: when facing US tariffs, Indian exporters maintained their prices and reduced shipments. They did not “eat” the tariff.

you are viewing a single comment's thread
view the rest of the comments

[–] Peereboominc@piefed.social 20 points 7 months ago (1 children)

You buy something from abroad and your country is adding an extra tax on it. Who else would pay the tax other than you, the buyer.

Tarrifs are great tool to make imported products more expensive so buyer will pick the local product.

[–] egrets@lemmy.world 4 points 7 months ago (2 children)

who else would pay the tax

Two other obvious options here:

Exporters take some of the hit (by lowering their prices) because it's still profitable even though it eats into their margins. I would have expected this segment to have been much bigger than it actually is per this study.
Exporters find other markets or reduce their output. The overview doesn't cover the drop in exports to the US (maybe it's in the details?), so it's hard to know the degree to which this has happened.

[–] Peereboominc@piefed.social 3 points 7 months ago

Yes, exactly.

Another option would be to lower the quality by using cheaper materials or downsize the product (10 % less candy in a bag for the same price)

[–] FishFace@piefed.social 1 points 7 months ago

The summary does say volumes fell.

This is significant, because the non-illiterate justification for tariffs is to boost domestic production. This can have some benefits. It won't make the country any richer, but it needs to be accounted for to understand the overall economic impact.