{"id":72085,"date":"2025-11-27T11:33:54","date_gmt":"2025-11-27T11:33:54","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ca\/72085\/"},"modified":"2025-11-27T11:33:54","modified_gmt":"2025-11-27T11:33:54","slug":"what-is-a-tariff-shock-insights-from-150-years-of-tariff-policy","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ca\/72085\/","title":{"rendered":"What Is a Tariff Shock?\u00a0Insights from 150 years of Tariff Policy"},"content":{"rendered":"<p class=\"sffed-meta-kicker has-primary-blue-color has-text-color sffed-has-margin-top-none sffed-has-padding-top-none sffed-has-margin-bottom-add--medium\">2025-26 | November 13, 2025<\/p>\n<p>In this paper we exploit 150 years of tariff policy in the US and abroad to estimate the short-run effects of tariff shocks on macro aggregates. A careful review of the major changes in US tariff policy since 1870 shows no systematic relation between the state of the cycle and the direction of the tariff changes, as partisan differences on the effects and desirability of tariffs led to opposite policy responses to similar economic conditions. Exploiting this quasi-random nature of tariff variations, we find that a tariff hike raises unemployment (lowers economic activity) and lowers inflation. Using only tariff changes driven by long-run considerations\u2014a traditional narrative identification\u2014gives similar results. We also obtain similar results if we restrict the sample to the modern post World War II period or if we use independent variation from other countries (France and the UK). These findings point towards tariff shocks acting through an aggregate demand channel.<\/p>\n<p>Suggested citation:\u00a0<\/p>\n<p>Barnichon, R\u00e9gis and Aayush Singh. 2025. \u201cWhat Is a Tariff Shock? Insights from 150 years of Tariff Policy.\u201d Federal Reserve Bank of San Francisco Working Paper 2025-26.\u00a0https:\/\/doi.org\/10.24148\/wp2025-26<\/p>\n<p>About the Authors<\/p>\n<p>\t\t\t<img loading=\"lazy\" decoding=\"async\" width=\"247\" height=\"300\" src=\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2025\/11\/Experts_Barnichon_sm.jpg\" class=\"sffed-associated-person__photo--square wp-post-image\" alt=\"\" style=\"width: 125px;height: 125px;object-fit: cover;object-position:top;overflow: hidden\"\/><\/p>\n<p>Regis Barnichon is a senior research advisor in the Economic Research Department of the Federal Reserve Bank of San Francisco. Learn more about <a href=\"https:\/\/www.frbsf.org\/our-people\/economists\/regis-barnichon\/\" aria-label=\"Learn more about Regis Barnichon\" rel=\"nofollow noopener\" target=\"_blank\">Regis Barnichon<\/a>\t\t<\/p>\n<p>Aayush Singh is a research associate, Economic Research Department, Federal Reserve Bank of San Francisco.<\/p>\n","protected":false},"excerpt":{"rendered":"2025-26 | November 13, 2025 In this paper we exploit 150 years of tariff policy in the US&hellip;\n","protected":false},"author":2,"featured_media":72086,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[42287,8463,8467,42283,384,30773,8469,13963,42284,42285,101,103,102,104,106,105,42286,42288],"class_list":["post-72085","post","type-post","status-publish","format-standard","has-post-thumbnail","category-san-francisco","tag-aayush-singh","tag-economic-research","tag-employment-unemployment","tag-global-macroeconomics","tag-inflation","tag-international-trade","tag-labor-markets","tag-macroeconomics","tag-publications-economic-research-working-paper","tag-regis-barnichon","tag-san-francisco","tag-san-francisco-headlines","tag-san-francisco-news","tag-sf","tag-sf-headlines","tag-sf-news","tag-working-paper","tag-working-papers"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/72085","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=72085"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/72085\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/72086"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=72085"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=72085"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=72085"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}