I know that but strikes me as odd that that point is supposed to be at 100%, see no good reason for that. Short-term I doubt that a 100% tariff would kill bilateral trade, demand for some things is just too inelastic
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"this is stupid" has rarely in the history of mankind kept people from buying things anyway, otherwise I would not own a 4k accordion that I hardly ever play
Probably correct — some products it’s going to take longer to reorient supply chains as there likely isn’t alternative suppliers of scale and in the meantime you’re forced to pay the piper I guess. Rare earths, solar panels, and (some) electronics come to mind if I had to take a poke
Also depends how porous things are. How much quiet rebadging of stuff takes place etc. Not legal but tonnes of it has happened vis a vis the Russia embargo.
In this case we are talking US imports to China so you'd rather have to discuss those instead of rare earths etc.
But yeah, I wager that chinese imports to US are a lot less elastic than vice versa so reciprocal tariffs may well deepen the trade deficit 🤷
Now that you mention it: provided Europe levies tariffs on US software products it would be interesting to see the effect of econ papers switching more and more to R in applied work to have an estimate for the elasticity of substitution based on our own work
Aaaaah, I see! But those would be chinese exports to US, no? This thread was talking about chinese imports from US because it was about the chinese tariff
But yeah, like I said, given that US demand for chinese goods is likely less elastic than vice versa, might deepen the trade deficit
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But yeah, I wager that chinese imports to US are a lot less elastic than vice versa so reciprocal tariffs may well deepen the trade deficit 🤷
... Does @jmwooldridge.bsky.social know?
But yeah, like I said, given that US demand for chinese goods is likely less elastic than vice versa, might deepen the trade deficit