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journal article
The Smoot-Hawley Tariff: A Quantitative AssessmentThe Review of Economics and Statistics
Vol. 80, No. 2 (May, 1998)
, pp. 326-334 (9 pages)
Published By: The MIT Press
//www.jstor.org/stable/2646642
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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%. 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% (ceteris paribus), although the combination of specific duties and deflation further raised the effective tariff and reduced imports an additional 8-10%. A counterfactual simulation suggests that nearly a quarter of the observed 40% decline in imports can be attributed to the rise in the effective tariff (i.e., Smoot-Hawley plus deflation).
Journal Information
The Review of Economics and Statistics is an 84-year old general journal of applied (especially quantitative) economics. Edited at Harvard University's Kennedy School of Government, The Review has published some of the most important articles in empirical economics. From time to time, The Review also publishes collections of papers or symposia devoted to a single topic of methodological or empirical interest.
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Among the largest university presses in the world, The MIT Press publishes over 200 new books each year along with 30 journals in the arts and humanities, economics, international affairs, history, political science, science and technology along with other disciplines. We were among the first university presses to offer titles electronically and we continue to adopt technologies that allow us to better support the scholarly mission and disseminate our content widely. The Press's enthusiasm for innovation is reflected in our continuing exploration of this frontier. Since the late 1960s, we have experimented with generation after generation of electronic publishing tools. Through our commitment to new products—whether digital journals or entirely new forms of communication—we have continued to look for the most efficient and effective means to serve our readership. Our readers have come to expect excellence from our products, and they can count on us to maintain a commitment to producing rigorous and innovative information products in whatever forms the future of publishing may bring.
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Countries around the world increased their tariffs in response. Domestic industries initially benefited from new tariffs. Imports and exports exchanged between the United States and Britain fell by nearly 66%.
Which actions were taken after World War II to help ensure that an economic crisis like the Great Depression would not occur again check all that apply?
The General Agreement on Tariffs and Trade reduced trade barriers. Countries created formal agreements to increase trade barriers.
What did the government leaders hope the result of the new tariff would be?
The act was passed by Congress _______ the start of the Great Depression. The purpose of the act was to ________ purchases of domestic goods. What did government leaders hope the result of the new tariff would be? It allowed the US government to work with other countries to reduce tariffs.
What did government leaders hope the result of the new tariff would be decreased production of agricultural goods?
The correct answer is increased sales for domestic producers.
What effect did tariff policies have on the Great Depression?
The Act and tariffs imposed by America’s trading partners in retaliation were major factors of the reduction of American exports and imports by 67% during the Depression. Economists and economic historians have a consensus view that the passage of the Smoot–Hawley Tariff worsened the effects of the Great Depression.
What happened as a result of the Hawley Smoot Tariff?
The Smoot-Hawley Act increased tariffs on foreign imports to the U.S. by about 20%. At least 25 countries responded by increasing their own tariffs on American goods. Global trade plummeted, contributing to the ill effects of the Great Depression.
What was a result of the Smoot-Hawley Tariff quizlet?
What was the end-result of the Smoot-Hawley Tariff Act? With the reduction of American exports came also the destruction of American jobs, as unemployment levels which were 6.3% (June 1930) jumped to 11.6% a few months later (November 1930).
What was the purpose of the Hawley Smoot Tariff quizlet?
The Smoot-Hawley Tariff Act of June 1930 raised U.S. tariffs to historically high levels. The original intention behind the legislation was to increase the protection afforded domestic farmers against foreign agricultural imports.
How did high tariffs damage the US economy?
High tariffs damage the U.S. economy by making it hard to import crops . Explanation: The high tariff is made to increase the cost of imported products and to increase domestic production. However, the increase in tariff in the year 1930 had made a huge impact in the economy.
What are the effects of tariff?
Tariffs are a tax placed by the government on imports. They raise the price for consumers, lead to a decline in imports, and can lead to retaliation by other countries.
How did tariffs negatively affect the global economy?
In the short run, tariffs are likely to disrupt global supply chains, and could reduce confidence, leading to a reduction in spending, particularly investment. receded, the tariffs are expected to have only a modest ongoing effect on global economic output.