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Intro Econ 5: Trade & Santa

Planet Money Summer School

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The Deadweight Loss of the Tax

If you make your shirt with a pocket near the waistline, it attracts a lower tariff rate. It's actually amazing. The whole thing that companies are trying to do is operate within a set of really Byzantine rules around what kind of tariff you're going to face. This is a really big deal because it says we want to try to avoid high taxes and that creates a lot of space for tariff engineers to come in and spend their time.

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