Steel and Aluminum import tariff impact on US trade deficit

Example model

Description: On 2-March-2018, President Trump proposed new import tariffs on steel and aluminum. It seems as if the projected net impacts of these tariffs on the total US trade deficit and US economy depends largely on which news outlets you get your news from. We thought it would be helpful to put together a simple and easy to understand model to estimate of the net impact of these tariffs on the US trade deficit, assuming that no other factors change (e.g., no retaliatory tariffs are enacted by other countries). We wanted something that allows you to understand how its estimates are being derived, with assumptions that can be easily replaced with your own, so that the model itself would be impartial to any particular viewpoint. We want the uncertainties that are inherent in such a simple model to be explicit, so you can see the range of possibilities and not just a single guess. Finally, we wanted the model to be easy to understand fully for non-economists (a group to which we belong, too).

This model accompanied a current event blog post on the Lumina blog: Impact of Trump’s proposed Steel & Aluminum tariffs on US trade deficit

Authors: Kimberley Mullins and Lonnie Chrisman, Lumina Decision Systems

Download: Steel and aluminum tariff model.ana