Wednesday, April 23, 2025
Hoover Institution | Stanford University
Presentations on the topic of tariffs.
PARTICIPANTS
Michael Bordo, Mickey Levy, Steve Davis, Stephen Redding, Andrew Grotto, John Cochrane, John Taylor, David Berkey, Hoyt Bleakley, Michael Boskin, Jake Carney, Marcelo ClericiArias, Rebel Cole, Francisco Covas, Michael De Groot, Alexander Downer, Sebastian Edwards, Elizabeth Elder, Charles Evans, David Fedor, David Figlio, Nick Gebbia, Lance Gilliland, Benjamin Ginsberg, Anthony Gregory, Erick Hanushek, Robert Hetzel, Robert Hodric, Norbert Holtcamp, Nicholas Hope, Bobby Inman, Otmar Issing, Tim Kaiser, Kevin Kliesen, Alla Lagudaeva, Suhani Jalota, Ken Judd, Tim Kaiser, Roman Kraussl, Jeff Lacker, David Laidler, CJ Li, John Li, Jacob Light, William Luther, Justin Matejka, Robert McCauley, Patrick McLaughlin, Christopher Meissner, Ilian Mihov, David Neumark, David Papell, Alessandra Peter, Melina Platas, Ned Prescott, Jörn Quitzan, Alvin Rabushka, Valerie Ramey, Macke Raymond, Jonathan Roll, Paola Sapienza, Pierre Siklos, Sean Singleton, Isaac Sorkin, Richard Sousa, Tom Stephenson, Barry Strauss, Christine Strong, Derel Tang, Kharis Templeman, Stephan Thomsen, Mark Tendall, Yevgeniy Teryoshin, Glenn Tiffert, Simon Wiederhold, Marck Weidenmeier, Oliver Xie, Tamar Yurshalmi, Philip Zelikow
ISSUES DISCUSSED
The following five speakers delivered a presentation on the topic of tariffs:
Michael Bordo, the Ilene and Morton Harris Distinguished Visiting Fellow at the Hoover Institution, and the Board of Governors Professor of Economics and director of the Center for Monetary and Financial History at Rutgers University.
Mickey Levy, visiting fellow at the Hoover Institution, member of the Shadow Open Market Committee, and former chief economist of Bank of America and Berenberg Capital Markets.
Steven Davis, the Thomas W. and Susan B. Ford Senior Fellow and Director of Research at the Hoover Institution.
Stephen Redding, the Trione Visiting Professor at the Stanford Institute for Economic Policy Research, and the Harold T. Shapiro *64 Professor in Economics at Princeton University.
Andrew Grotto, the William J. Perry International Security Fellow at the Center for International Security and Cooperation at the Freeman Spogli Institute.
John Cochrane, the Rose-Marie and Jack Anderson Senior Fellow at the Hoover Institution, was the moderator.
SUMMARY
The Hoover Institution Economic Policy Working Group hosted a panel with five presentations on the topic of tariffs: four by economists and one by a geopolitics expert. All the economists stressed the negative economic effect of the current tariffs. Michael Bordo presented some lessons from history of the economic costs of tariffs and how many of the lessons of the past seemed not to have been learned. Many countries have tried to grow “infant” industries behind protective barriers, or to substitute for imports, but the result has been stagnation. Examples include India after independence and Argentina. Bordo also showed that after two centuries and a half of steady liberalization, today’s tariffs are higher than at any point since Smoot-Hawley tariffs in the Great Depression.
Mickey Levy looked at the conditions in financial markets today. He documented great uncertainty over Trump’s tariff policies, lower asset prices, and a higher probability of a recession.
Steve Davis presented indices of policy uncertainty that he has developed with coauthors. The indices are based on text analysis of newspaper articles and other sources. These indices have spiked since the trade war began. Steve also presented some analysis on the impact of this uncertainty, especially on firms’ willingness to invest.
Stephen Redding went back to the basics of international trade theory and the advantages of trade. He showed how tariffs are a highly distortionary tax on consumers and business. Since trade is like better technology, allowing the economy to do more with less, tariffs are in a sense a tax on technology.
Andrew Grotto discussed the national security and “economic statecraft” angle. He suggested that we analyze tariffs as a means to coerce other countries to do what we want, rather than a purely economic measure. However, he found the current tariff policy is ineffective toward that goal, both in heightening resistance among targets and in alienating allies.
To read the slides from:
Michael Bordo and Mickey Levy, click the following link
https://www.hoover.org/sites/default/files/2025-04/Levy-Bordo%20Trump_s%20Tariffs%20April%2019.pdf
Steve Davis, click the following link
https://www.hoover.org/sites/default/files/2025-04/Davis-Destructive%20Trade%20Policy%2023%20April%202025.pdf
Stephen Redding, click the following link
https://www.hoover.org/sites/default/files/2025-04/Redding_tariffs.pdf
Andrew Grotto, click the following link
https://www.hoover.org/sites/default/files/2025-04/Grotto-2025-04-23%20%E2%80%94%20Hoover%20tariff%20workshop.pdf
