Marketplace All-in-One Why people see tariff-induced inflation differently
Oct 27, 2025
Join University of Chicago economist Alex Imas, co-author of The Winner's Curse, as he explores why consumers perceive tariff-induced inflation differently from other types of inflation. Imas reveals how narratives around fairness and strategy shape consumer tolerance towards price hikes. He discusses the impact of expectations and perceptions of corporate behavior on public support for tariffs. The conversation also touches on the new rare earths separation facility in Louisiana, highlighting its significance for the U.S. supply chain.
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U.S. Rare Earths Facility Planned
- Eclair Resources will open a rare earths separation facility in Louisiana to process dysprosium and terbium oxides.
- The plant aims to reduce U.S. reliance on China and should operate by 2028, Elizabeth Troval reports.
Tariffs Carry Political Meaning
- People tolerate tariff-driven price increases differently because tariffs carry a political and policy meaning beyond pure price changes.
- Alex Imas finds tariffs evoke 'superiority seeking' where consumers accept higher prices if they believe it punishes foreign competitors.
Superiority Seeking Shapes Reactions
- Superiority seeking describes people who value consuming goods that others can't access or have lost access to.
- Imas argues this preference makes some consumers willingly bear tariff costs to signal national advantage.
