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Deriving the Trump tariffs

Author

Listed:
  • Ronald B. Davies

    (University College Dublin and Skatteforsk)

Abstract

On April 2, 2025, President Donald Trump announced a wide-ranging set of "reciprocal tariffs" against many of its trading partners. The calculation of these tariffs have elicited a largely negative reaction in part due to the simple formula used to calculate them. In this note, I provide a model which, under the proper assumptions, does indeed result in the administration's formula. I, however, leave it to the reader to judge whether these assumptions are reasonable.

Suggested Citation

  • Ronald B. Davies, 2025. "Deriving the Trump tariffs," Economics Bulletin, AccessEcon, vol. 45(2), pages 1056-1059.
    • Handle: RePEc:ebl:ecbull:eb-25-00173
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2025/Volume45/EB-25-V45-I2-P91.pdf
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    References listed on IDEAS

    as
    1. Chaonan Feng & Liyan Han & Lei Li, 2023. "Who Pays for the Tariffs and Why? A Tale of Two Countries," CESifo Working Paper Series 10497, CESifo.
    2. Chaonan Feng & Liyan Han & Lei Li, 2023. "Who Pays for the Tariffs and Why? A Tale of Two Countries," CRC TR 224 Discussion Paper Series crctr224_2023_432, University of Bonn and University of Mannheim, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

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    JEL classification:

    • F1 - International Economics - - Trade
    • F2 - International Economics - - International Factor Movements and International Business

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