The Smoot-Hawley Tariff: A Quantitative Assessment

35 Pages Posted: 16 Sep 1999 Last revised: 30 Sep 2010

See all articles by Douglas A. Irwin

Douglas A. Irwin

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

Date Written: March 1996

Abstract

In the two years after the imposition of the Smoot-Hawley tariff in June 1930, the volume of U.S. imports fell over 40 percent. To what extent can this collapse of trade be attributed to the tariff itself versus other factors such as declining income or foreign retaliation? Partial and general equilibrium assessments indicate that the Smoot-Hawley tariff itself reduced imports by 4-8 percent (ceteris paribus), although the combination of specific duties and deflation further raised the effective tariff and reduced imports an additional 8-10 percent. A counter-factual simulation suggests that nearly a quarter of the observed 40 percent decline in imports can be attributed to the rise in the effective tariff, (i.e., Smoot-Hawley plus deflation).

Suggested Citation

Irwin, Douglas A., The Smoot-Hawley Tariff: A Quantitative Assessment (March 1996). NBER Working Paper No. w5509. Available at SSRN: https://ssrn.com/abstract=4916

Douglas A. Irwin (Contact Author)

Dartmouth College - Department of Economics ( email )

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National Bureau of Economic Research (NBER)

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