Did Late Nineteenth Century U.S. Tariffs Promote Infant Industries? Evidence from the Tinplate Industry

50 Pages Posted: 3 Feb 1999 Last revised: 11 Oct 2010

See all articles by Douglas A. Irwin

Douglas A. Irwin

Dartmouth College - Department of Economics; National Bureau of Economic Research (NBER)

Date Written: December 1998

Abstract

This paper examines the role of late nineteenth century U.S. tariffs in promoting infant industries by focusing on the much heralded example of the tinplate industry. After earlier failures, the tinplate industry became established and flourished after receiving protection in the McKinley tariff of 1890. Treating the entry and exit decisions of producers as endogenous, a probability model is estimated to determine the conditions under which domestic tinplate production will take place. Counterfactual simulations indicate that, in the absence of the McKinley duties, domestic tinplate production would have arisen about a decade later as U.S. iron and steel prices (comprising three-quarters of production costs) converged with those in Britain. While the tariff accelerated the industry's development, welfare calculations suggest that protection does not pass a cost-benefit test.

Suggested Citation

Irwin, Douglas A., Did Late Nineteenth Century U.S. Tariffs Promote Infant Industries? Evidence from the Tinplate Industry (December 1998). NBER Working Paper No. w6835. Available at SSRN: https://ssrn.com/abstract=145238

Douglas A. Irwin (Contact Author)

Dartmouth College - Department of Economics ( email )

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