(Xinhua)14:11, May 24, 2019
NEW YORK, May 23 (Xinhua) — The latest round of U.S. tariffs on Chinese goods will impose a total annual cost of 831 U.S. dollars for a typical U.S. household, according to a research posted Thursday on the Federal Reserve (Fed) Bank of New Yorks website.
The study was co-authored by Mary Amiti, assistant vice president in New York Feds research and statistics group, Stephen Redding, professor in economics at Princeton University, and David Weinstein, professor of the Japanese economy at Columbia University.
According to the research, increased tariffs in 2018 imposed an annual cost of 419 dollars for the typical U.S. household, with an added tax burden for consumers and a deadweight or efficiency loss as the two components.
The study also found that a 10 percent tariff reduced import demand by 43 percent.
The researchers estimated that the annualized deadweight loss will increase to 620 dollars per household with higher tariffs imposed.
In sum, according to our estimates, these higher tariffs are likely to create large economic distortions and reduce U.S. tariff revenues, according to the research.
Earlier this month, the United States increased additional tariffs on 200 billion U.S. dollars worth of Chinese imports from 10 percent to 25 percent, and has threatened to raise tariffs on more Chinese imports.
In response to the new round of U.S. protectionist moves, China has announced that it will raise additional tariffs on a range of U.S. imports from June 1, and will fight to the end. Enditem