Publications
Publications
- March, 2021
- American Economic Review: Insights
Tariff Passthrough at the Border and at the Store: Evidence from U.S. Trade Policy
By: Alberto Cavallo, Gita Gopinath, Brent Neiman and Jenny Tang
Abstract
We use micro data collected at the border and the store to characterize the price impact of recent US trade policy on importers, exporters, and consumers. At the border, import tariff passthrough is much higher than exchange rate passthrough. Chinese exporters did not lower their dollar prices by much, despite the recent appreciation of the dollar. By contrast, US exporters significantly lowered prices affected by foreign retaliatory tariffs. In US stores, the price impact is more limited, suggesting that retail margins have fallen. Our results imply that, so far, the tariffs' incidence has fallen in large part on US firms.
Keywords
Trade Policy; Tariffs; Exchange Rate Passthrough; Economics; Trade; Policy; Currency Exchange Rate; Price; United States
Citation
Cavallo, Alberto, Gita Gopinath, Brent Neiman, and Jenny Tang. "Tariff Passthrough at the Border and at the Store: Evidence from U.S. Trade Policy." American Economic Review: Insights 3, no. 1 (March 2021).
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