Costs of Trade Wars: The Distributional Consequence of US Section 301 Tariffs Against China

Kara Reynolds

No 2022-02, Working Papers from American University, Department of Economics

Abstract: Between 2018 and 2020, the United States imposed massive new tariffs under a variety of trade laws, most notably the Section 301 tariffs against China. This new protection is extensive in magnitude and breadth; tariffs range from 10 to 30 percent and cover 50 percent of US consumer imports from China and 16 percent of total US consumer imports. Using data from the Consumer Expenditure Survey, I find that the new taxes are highly regressive; the lowest income consumers pay more than 1.2 percent of their after-tax income to fight these trade wars, while the wealthiest consumers pay just 0.18 percent of their after-tax income. I find additional evidence that women and parents are paying an unfair share of efforts to put America first.

Keywords: Tariffs; Section 301; Consumer Loss (search for similar items in EconPapers)
JEL-codes: F13 F14 F61 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-ban, nep-cwa and nep-int
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https://dx.doi.org/10.2139/ssrn.3862764 First version, 2022 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:amu:wpaper:2022-02

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