The Trump administration's tariff calculations were incorrect, and the actual tax rate may have been overestimated by four times
According to ChainCatcher, a report by Fortune states that scholars from the American Enterprise Institute (AEI) have found significant calculation errors in the tariff policy recently announced by the Trump administration. The White House incorrectly used the retail price elasticity (0.25) in the formula instead of the import price elasticity (0.945), resulting in an overestimation of the tariff rates by about four times.If the correct values were used, Cambodia's 49% tariff rate would drop to 13%, Vietnam's 46% would decrease to 12.2%, and most countries would even fall to the White House's set minimum tax rate of 10%.This error has triggered significant market volatility, with noticeable declines in the stock markets of the U.S., Asia, and Europe. AEI economists have accused this as a result of the White House deliberately manipulating the figures to achieve Trump's desired high tariffs.The White House, on the other hand, argues that using retail prices is reasonable and states that the actual tariff rates should be higher.