Theory-Consistent Tariff Aggregation

James E. Anderson, Mario Larch, Serge Shikher and Yoto V. Yotov

No 12902, CESifo Working Paper Series from CESifo

Abstract: We propose and implement a theory-consistent procedure to aggregate tariffs. Theory implies that (i) the import weights used for aggregation should be net of the impact of tariffs, rather than based on observed imports, and (ii) aggregation must account for trade elasticities, both at the disaggregated and aggregate levels. Our aggregator nests as special cases and corrects the deficiencies of the two existing alternatives – the simple-average and import-weighted tariffs. Our procedure can be applied at any level of aggregation. We deploy it to aggregate 6-digit HS tariffs to the industry-level of the International Trade and Production databases of the USITC. Several applications use the new Theory-Consistent Tariff Database (TCTD) to highlight the advantages of the theory-consistent tariffs.

Keywords: tariffs; tariff aggregation; gravity theory; trade elasticity (search for similar items in EconPapers)
JEL-codes: F11 F13 F14 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_12902

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