Understanding Tariff Impact

This lecture delves into the analysis of trade policy's impact on the economy, focusing on the effects of tariffs. It covers topics such as the different types of tariffs, how tariffs change prices and quantities, and the welfare effects on both the home and foreign markets. The lecture also explores the distributional consequences of tariffs within nations, highlighting winners and losers. Through a series of MS-MD diagrams and real-world examples, the instructor provides a comprehensive overview of the positive and negative implications of tariffs on trade and welfare.