‘Liberation day’ likely to cause US recession – NBER study
Paper sets out conditions for tariff-driven downturn and says US is likely to meet them
US president Donald Trump’s “liberation day” tariffs are likely to set the country’s economy on a path to recession, economists find in a new study.
The working paper, published this week by the US National Bureau of Economic Research, says trade models tend to focus on the long-term efficiency impact of tariffs rather than the short-run recession risk. To explore the short-term impact, the authors – Adrien Auclert, Matthew Rognlie and Ludwig Straub – build a simple New Keynesian model with
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