The Impact of Tariffs on Prices

The Trump Administration claims tariffs will help protect American jobs, revitalize manufacturing, and raise revenues, while keeping prices stable. While it may be too soon to evaluate some of these expected outcomes, pioneering efforts by Alberto Cavallo in gathering real time price data on goods, distinguished by their country of origin, makes it possible to analyze how tariffs are affecting prices. Alberto joins EconoFact Chats to discuss who bears the cost increases from the tariffs, the role of policy uncertainty in companies’ pricing decisions, and the cumulative effects of tariffs on prices. Alberto is the Thomas S. Murphy Professor of Business Administration at Harvard Business School. He co-founded PriceStats, the leading private source of inflation statistics in over 20 countries.