Tariffs in U.S. Trade Policy: Historical Patterns, Economic Effects, and 2025 Projections
Keywords:
US tariff policies, Holdup Theory, International Trade, international relations, World Trade Organization (WTO).Abstract
This paper examines the historical economic impact of US tariff policies and draws lessons for proposed 2025 tariffs. Through analysis of major tariff policies - including the Smoot-Hawley Act, Roosevelt's Reciprocal Trade Agreements Act, NAFTA, China's WTO accession, and AUSFTA -the research integrates historical data with economic frameworks like holdup theory to provide a comprehensive understanding of tariffs' effects on economic growth, trade, employment, and international relations. The findings indicate that while tariffs historically served as important revenue sources and protection mechanisms, their modern application has often led to significant economic costs. Analysis of recent tariffs (2018-2019) demonstrates substantial trade diversion and welfare losses, with consumers bearing most costs through higher prices. The paper concludes that future tariff strategies should be highly selective and strategically designed rather than broadly applied, with careful attention to sector-specific vulnerabilities and complementary adjustment assistance programs to mitigate negative distributional effects.
Author Biography
Victoria Torino, Texas A&M University
Victoria Torino is a senior finance professional with extensive management and nonprofit experience. She has a Master's degree in Jurisprudence from Texas A&M and an MD in Science in Accountancy from the State University of New York. She is a certified accountant licensed with Virginia and North Carolina boards of CPA and a licensed tax professional with the IRS. E-mail: vtorino@tamu.edu
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