David Friedman’s Substack • 260 implied HN points • 14 Feb 25
- Retaliatory tariffs are taxes on imports that match the tariffs a country imposes on exports. They aim to make both countries reconsider their tariff policies.
- If one country sets high tariffs, the other may respond with corresponding tariffs, which might lead to both countries lowering their tariffs for mutual benefit.
- The idea of reciprocal tariffs can help simplify trade negotiations, but it can also create loopholes where countries find ways to keep protections in place without directly using tariffs.