Some argue that tariffs always hurt the imposing country\'s economic welfare, an

Question

Some argue that tariffs always hurt the imposing country's economic welfare, and are typically designed to shift resources from one sector to another, protected or preferred one, within an economy. Find and discuss a counter example to this argument.
Please more details, thanks!! Some argue that tariffs always hurt the imposing country's economic welfare, and are typically designed to shift resources from one sector to another, protected or preferred one, within an economy. Find and discuss a counter example to this argument.
Please more details, thanks!!
Please more details, thanks!!

Explanation / Answer

Tariffs hinder free flow of goods and services across the world. it breeds inefficiencies in production system. Economy tends to move towards the inefficient outcomes through the redistribution of resources. Country no longer produces according to its comparative advantages. Prices of products rise for consumers. Hence, welfare of consumers tend to be compromised.

Imposition of tariffs on import of steel is foremsot example of such situation. Now US is protecting its domestic steel producers from external competition. US system is not well efficient.

But short run, there are few positive impacts of tariffs. it helps to tackle the problem of BOP crisis and second, it helps to generate more employment opportunities. Imposition of tariffs by presiden trump would invariably increase employments for US but it will not be long lasting.

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