The loss of growth due to protectionism is hard to estimate

If a country introduces tariffs, the effect on this country ’s and other countries ’ growth depends on: The degree of substitutability between the country’s production and the imports taxed by the tariffs; How the income provided by the tariffs is used. If the United States puts in place tariffs in the absence of retaliatory measures on the part of other countries, there may be: A positive effect on US growth if domestic production is substitutable for imports and the tariffs are redistributed to domestic economic agents; Zero effect on US growth if domestic production is not substitutable for imports and the tariffs are redistributed; A negative effect on US growth if domestic production is not substitutable for imports and the tariffs are not redistributed; If other countries retaliate with equivalent measures in response, and if the countries are symmetrical, there may be: Zero effect on all countries’ growth regardless of the degree of substitutability between domestic production and imports, if the tariffs are redistributed to domestic economic agents everywhere; A negative effect on all countries’ growth if domestic production is not substitutable for imports and if the tariffs are not redistributed.