The Return to Protectionism

@article{Fajgelbaum2019TheRT,
  title={The Return to Protectionism},
  author={Pablo D. Fajgelbaum and Pinelopi Koujianou Goldberg and Patrick Joseph Kennedy and Amit K. Khandelwal},
  journal={ERN: Fiscal Policy Objectives; Policy Designs; Policy Coordination (Topic)},
  year={2019}
}
After decades of supporting free trade, in 2018 the U.S. raised import tariffs and major trade partners retaliated. We analyze the short-run impact of this return to protectionism on the U.S. economy. Import and retaliatory tariffs caused large declines in imports and exports. Prices of imports targeted by tariffs did not fall, implying complete pass-through of tariffs to duty-inclusive prices. The resulting losses to U.S. consumers and firms who buy imports was $51 billion, or 0.27% of GDP. We… 
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