"Econ 102" with Noah Smith and Erik Torenberg

A Deep Dive on Tariffs

17 snips
Feb 7, 2024
Dive into the complex world of tariffs and their effects on global trade, particularly in the U.S. auto industry. Discover how China's real estate woes and national policies shape economic strategies. Explore the historical parallels in manufacturing from figures like Ford to Musk, and the delicate dance of domestic production versus global competition. The discussion also touches on the cyclical nature of China's governance and the critical need for strategic industrial policies to foster innovation and resilience in the face of international challenges.
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INSIGHT

Tariff Impact

  • Tariffs' impact is reduced by exchange rate adjustments.
  • Reduced demand for a country's currency lowers its price, making its goods cheaper.
INSIGHT

US Car Industry Advantages

  • US car factories have inherent advantages like proximity to consumers and better support services.
  • Foreign car companies often establish US factories to overcome these advantages.
ANECDOTE

Turkey's Non-Tariff Barriers

  • Turkey uses non-tariff barriers, like requiring extensive support services, to limit car imports.
  • These regulations are harder to challenge under WTO rules.
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