3 ms·

Such a tariff could be made more economically neutral if the tariff proceeds were distributed to citizens as a dividend too.

• eru 7y ago
  You'd still get deadweight losses. Easier to image with a 1,000,000% tariff: nobody would actually pay the tariff, so there's no dividend to distribute. Yet, you get an economic impact.
  • dv_dt 7y ago
    no one is suggesting that tariff level though so it's a pretty much unrealistic value to work throuh.
    • eru 7y ago
      Well, that's the tariff level that corresponds to a ban on imports, basically. You still get deadweight losses from lower tariff levels.