3min chapter

Pekingology cover image

Political Risk and Firm Exit

Pekingology

CHAPTER

Is Tariff a Tax on Consumers in Your Own Market?

A lot of the confusion behind politics of the trade war is this idea that governments could sort of turn on or off trade and investment floes like a spigot, right? Because the aloted, the justification behind tariffs was that by imposing these costs, we will increase the incentives for multinational companies to relocate. And all that sounds good on paper, right? If you can incentivize amerian companies to come back by raising their cost marginally, would be a good, you know, good thing from a us policy perspective. But in reality, whatl we saw, right? The problem is that nowhere in that logic, which is a very China logic, do the behavior of mult

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