Asymmetric Link between U.S. Tariff Policy and Income Distribution: Evidence from State Level Data

Mohsen Bahmani-Oskooee and Mehrnoosh Hasanzade ()
Additional contact information
Mehrnoosh Hasanzade: The University of Wisconsin-Milwaukee

Open Economies Review, 2020, vol. 31, issue 4, No 4, 857 pages

Abstract: Abstract Empirical studies pertaining to the effects of openness on income inequality is rather mixed. We consider the impact of the U.S. tariff policy on income inequality in the U.S. over the period 1929–2015. We go beyond the literature and argue that the effects could be asymmetric. When we used data from the U.S. as a whole, like previous studies, we found no significant link between income inequality and the average tariff rate in the U.S. However, when we used data from each state of the U.S., we were able to find short-run asymmetric effects in 22 states and long-run effects in 12. More precisely, we found that an increase in the average U.S. tariff rate will worsen income inequality in Arizona, the District of Columbia, and Idaho, and improve it in West Virginia. On the other hand, we found that cutting tariff rates will improve inequality in the nine states of Alaska, Connecticut, Iowa, Illinois, Indiana, New Hampshire, New Jersey, Pennsylvania, and Utah, and will worsen it only in Idaho.

Keywords: Tariff; Income inequality; Asymmetry; State level data; United States (search for similar items in EconPapers)
JEL-codes: O16 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://link.springer.com/10.1007/s11079-020-09584-5 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:openec:v:31:y:2020:i:4:d:10.1007_s11079-020-09584-5

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/11079/PS2

DOI: 10.1007/s11079-020-09584-5

Access Statistics for this article

Open Economies Review is currently edited by G.S. Tavlas

More articles in Open Economies Review from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().