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Tariff Reciprocity

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Listed:
  • James E. Anderson
  • Yoto V. Yotov

Abstract

U.S. President Trump’s emphasis on ‘tariff reciprocity’ has focused public attention on relative height of tariffs as a measure of fairness in trade relations. The import-weighted average tariff subsequently used by USTR to rank how protectionist are trading partners is atheoretic and misleading for this purpose. We propose and implement a theory-consistent tariff index that combines thousands of tariff rates into an import volume equivalent uniform tariff. The index: (i) is consistent with the WTO principle that trade relations should aim at reciprocal exchange of market access, and (ii) decomposes neatly into each country’s buyer and seller incidence of tariffs.

Suggested Citation

  • James E. Anderson & Yoto V. Yotov, 2025. "Tariff Reciprocity," NBER Working Papers 34052, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:34052
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    Other versions of this item:

    • James Anderson & Yoto Yotov, 2025. "Tariff Reciprocity," Working Papers 202526, Center for Global Policy Analysis, LeBow College of Business, Drexel University.

    References listed on IDEAS

    as
    1. Egger, Peter & Larch, Mario, 2008. "Interdependent preferential trade agreement memberships: An empirical analysis," Journal of International Economics, Elsevier, vol. 76(2), pages 384-399, December.
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    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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