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How Restrictive is U.S. Trade Policy?

Author

Listed:
  • Michael E. Waugh

Abstract

This short note computes Trade Restrictiveness Index measures for current U.S. trade policy. Building on the ideas of Anderson and Neary (1996, 2005), the Trade Restrictiveness Index is the uniform tariff that leaves the U.S. consumer as well off as under actual policy. As of October 2025, U.S. trade policy is twice as restrictive as headline tariff numbers suggest. The Trade Restrictiveness Index is 23 percent, which stands in contrast to the 11 percent average tariff rate. Trade policy towards Canada and Mexico is two to three times more restrictive than average tariff rates suggest. Sectoral analysis shows that the restrictiveness is concentrated in vehicles, machinery, and electrical equipment.

Suggested Citation

  • Michael E. Waugh, 2026. "How Restrictive is U.S. Trade Policy?," NBER Working Papers 34687, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:34687
    Note: EFG IFM ITI
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    More about this item

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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