What Is a Tariff Shock? Insights from 150 years of Tariff Policy - (Inflation Goes Down)

[excalibur]

Well, this is fascinating.

So we should expect, as has already been seen early on, lower inflation.

But with the trillions pledged in investment in the USA, the unemployment number should go down beginning the middle of 2026 at the latest.

...

The assessment, from the Federal Reserve Bank of San Francisco considered the “150 years of tariff policy in the U.S. and abroad.”

...

The study found “when countries raise tariffs, prices actually fall, not rise.”

Authors Regis Barnichon and Aayush Singh found, “We find that a tariff hike raises unemployment and lowers inflation. … This goes against the predictions of standard models, whereby CPI inflation should go up in response to higher tariffs.”

...​

Fed Agenda Faulted, Cackling Kamala's Claims About Tariffs Left "In Tatters" by New Study - 🔔 The Liberty Daily

If you love the news, check out The Liberty Daily's homepage. (WND News Center)—The common claims about tariffs, used liberally by President Donald Trump to bring about a more fair international trading platform for Americans, have been exploded by a new study that assesses the impact of those...

thelibertydaily.com

What Is a Tariff Shock? Insights from 150 years of Tariff Policy - San Francisco Fed

In this paper we exploit 150 years of tariff policy in the US and abroad to estimate the short-run effects of tariff shocks on macro aggregates. A careful

www.frbsf.org

 

[elektra]

I dont trust studies, even if they are giving me the "result" I like.
I find when I read a study, or if some references a study, the study can never be found. We are just told to believe.
That is my study rant.

either way, the howling and crying from democrats and republicans that hate Trump has reached a nauseating level.
Sadly there will be another 100 threads on tariffs that end up being a tirade of insults.

Studies, they say whatever the author wants.

 

[elektra]

intertemporal substitution elasticity, yep, just what I though, straight from the paper.

The paper studies our economy back in the 1800's as if tariffs then, would have the same effect today? The paper talks about interest rates?

Seems like back then, we did not have a federal reserve and we had a gold standard. We also had to compete with countries that were older, mature, and more modern than our country. Not so much today.

Tariffs or no tariffs, prices can not go up more, Americans are broke. We cant afford higher prices. It times for us Americans to boycott everything but essentials.

Well, I guess that is a moot point, (where is mamoot?) It is moot cause the prices are coming down and most countries have caved on tariffs so this paper seems a day late and a dollar short

 

[georgephillip]

What response do you receive if you ask ChatGPT the following question: What evidence is there supporting the claim that when countries raise tariffs, prices actually fall, not rise?

"There is evidence—though limited and context-specific—that prices can fall after tariffs are raised. It’s not the typical outcome, but it can happen under certain conditions. Here are the main mechanisms and empirical cases where this counterintuitive result has been observed:

"1. When firms with market power absorb the tariff instead of passing it on

"If a foreign supplier or domestic importer has high profit margins, elastic demand, or strong competitive pressure, they may lower their pre-tariff price to keep market share.

"Empirical Evidence​

"U.S.–China tariffs (2018–2019).."

 

[dudmuck]

 

[candycorn]

Well, this is fascinating.

So we should expect, as has already been seen early on, lower inflation.

But with the trillions pledged in investment in the USA, the unemployment number should go down beginning the middle of 2026 at the latest.

...​

​

The assessment, from the Federal Reserve Bank of San Francisco considered the “150 years of tariff policy in the U.S. and abroad.”​

​

...​

​

The study found “when countries raise tariffs, prices actually fall, not rise.”​

​

Authors Regis Barnichon and Aayush Singh found, “We find that a tariff hike raises unemployment and lowers inflation. … This goes against the predictions of standard models, whereby CPI inflation should go up in response to higher tariffs.”​

​

...​

Fed Agenda Faulted, Cackling Kamala's Claims About Tariffs Left "In Tatters" by New Study - 🔔 The Liberty Daily

If you love the news, check out The Liberty Daily's homepage. (WND News Center)—The common claims about tariffs, used liberally by President Donald Trump to bring about a more fair international trading platform for Americans, have been exploded by a new study that assesses the impact of those...

thelibertydaily.com

What Is a Tariff Shock? Insights from 150 years of Tariff Policy - San Francisco Fed

In this paper we exploit 150 years of tariff policy in the US and abroad to estimate the short-run effects of tariff shocks on macro aggregates. A careful

www.frbsf.org

Incorrect.

Prices are going up.

https://www.npr.org/2025/11/19/nx-s1-5608384/tariffs-consumers-shipping-shopping-prices

UPS is now collecting checks on items that had Tariff-Shock after the purchase.

 

[Old Rocks]

Well, this is fascinating.

So we should expect, as has already been seen early on, lower inflation.

But with the trillions pledged in investment in the USA, the unemployment number should go down beginning the middle of 2026 at the latest.

...​

​

The assessment, from the Federal Reserve Bank of San Francisco considered the “150 years of tariff policy in the U.S. and abroad.”​

​

...​

​

The study found “when countries raise tariffs, prices actually fall, not rise.”​

​

Authors Regis Barnichon and Aayush Singh found, “We find that a tariff hike raises unemployment and lowers inflation. … This goes against the predictions of standard models, whereby CPI inflation should go up in response to higher tariffs.”​

​

...​

Fed Agenda Faulted, Cackling Kamala's Claims About Tariffs Left "In Tatters" by New Study - 🔔 The Liberty Daily

If you love the news, check out The Liberty Daily's homepage. (WND News Center)—The common claims about tariffs, used liberally by President Donald Trump to bring about a more fair international trading platform for Americans, have been exploded by a new study that assesses the impact of those...

thelibertydaily.com

What Is a Tariff Shock? Insights from 150 years of Tariff Policy - San Francisco Fed

In this paper we exploit 150 years of tariff policy in the US and abroad to estimate the short-run effects of tariff shocks on macro aggregates. A careful

www.frbsf.org

Have you ever read Adam Smith's "Wealth of Nations"? Quite obviously you have not.

 

[Old Rocks]

intertemporal substitution elasticity, yep, just what I though, straight from the paper.

The paper studies our economy back in the 1800's as if tariffs then, would have the same effect today? The paper talks about interest rates?

Seems like back then, we did not have a federal reserve and we had a gold standard. We also had to compete with countries that were older, mature, and more modern than our country. Not so much today.

Tariffs or no tariffs, prices can not go up more, Americans are broke. We cant afford higher prices. It times for us Americans to boycott everything but essentials.

Well, I guess that is a moot point, (where is mamoot?) It is moot cause the prices are coming down and most countries have caved on tariffs so this paper seems a day late and a dollar short

Oh, but they will go up more. And essentials will be the leading factors in the rise.

 

[Marener]

So we should expect, as has already been seen early on, lower inflation.

The paper says that inflation drops because tariffs are so economically hazardous that they result in decreased employment, production and therefore aggregate demand.

So yes, the papers suggest that tariffs lower inflation because they do serious harm to the economy.

 

[excalibur]

The paper says that inflation drops because tariffs are so economically hazardous that they result in decreased employment, production and therefore aggregate demand.

So yes, the papers suggest that tariffs lower inflation because they do serious harm to the economy.

Meanwhile, Trump has garnered close to $20 trillion in investments in the USA. In less than a year.

Cry harder.

 

[Marener]

Meanwhile, Trump has garnered close to $20 trillion in investments in the USA. In less than a year.

He’s garnered “promises”, which are totally meaningless economically speaking.

 

[candycorn]

"Now, we did reach out to UPS, who told us that if customers track their packages, they should see an option to pay any fees before the item arrives at their door. But if you don't, you will be asked for a check at the door, like James, who did not hand over a check. So the UPS guy left, took the package with him. And when James went online, indeed, UPS had a tidy, itemized breakdown of monies owed. So there were $22.88 in unpaid tariffs, which, OK, the US had a 35% tariff in place with Canada when James ordered his collectible. That's about right. But then, there was an additional $24 in, quote, "UPS brokerage and partner government agency fees."

The $22.88 was after the purchase; meaning that the price of the item + shipping at the time of the sale was one price...tarrifs imposed during the transportation of the goods jacked the price up $22.88.

Tariffs are applied when the goods reach the US.

https://www.npr.org/transcripts/nx-s1-5608384