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Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism

Kyle Handley, Fariha Kamal () and Ryan Monarch

No 676, Working Papers from Research Seminar in International Economics, University of Michigan

Abstract: We examine the impacts of the 2018-2019 U.S. import tariff increases on U.S. export growth through the lens of supply chain linkages. Using 2016 confidential firm-trade linked data, we identify firms that eventually faced tariff increases. They accounted for 84% of all exports and represented 65% of manufacturing employment. For the average affected firm, the implied cost is $900 per worker in new duties. We construct product-level measures of exporters' exposure to import tariff increases and estimate the impact on U.S. export growth. The most exposed products had relatively lower export growth in 2018-2019, with larger effects in 2019. The decline in export growth in 2019Q3, for example, is equivalent to an ad valorem tariff on U.S. exports of 2% for the typical product and up to 4% for products with higher than average exposure.

Keywords: Global supply chains; tari s; trade war; U.S. exports (search for similar items in EconPapers)
JEL-codes: F1 F13 F14 F23 H2 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2020-08
New Economics Papers: this item is included in nep-int
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https://fordschool.umich.edu/rsie/workingpapers/Papers676-700/r676.pdf

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Working Paper: Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism (2020) Downloads
Working Paper: Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism (2020) Downloads
Working Paper: Rising Import Tariffs, Falling Export Growth: When Modern Supply Chains Meet Old-Style Protectionism (2020) Downloads
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