Year: 1996
Type: report
Abstract: In the two years after the imposition of the Smoot-Hawley tariff in June 1930, the volume of U.S. imports fell over 40 percent. To what extent can this collapse of trade be attributed to the tariff itself versus other factors such as declining income or foreign retaliation? Partial and general equilibrium assessments indicate that the Smoot-Hawley tariff itself reduced imports by 4-8 percent (ceteris paribus), although the combination of specific duties and deflation further raised the effective tariff and reduced imports an additional 8-10 percent. A counter-factual simulation suggests that nearly a quarter of the observed 40 percent decline in imports can be attributed to the rise in the effective tariff, (i.e., Smoot-Hawley plus deflation).
DOI: 10.3386/w5509
Author: Douglas Irwin
Institutions: Dartmouth College, National Bureau of Economic Research
Language: English
Topic: Global trade and economics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1979016166