Source: EconLog
by David Hebert
“Because tariffs are a tax, they raise the price that consumers pay, increase the cost that sellers incur, or some combination of both. Point is: someone will pay the tax and those tax dollars will then flow into the federal government in the form of tariff revenue. … A quota is a legal restriction on the amount of a good that can be imported. Because it restricts the amount of a good that is allowed to enter a market, we can easily imagine a tariff and a quota having the same impact on the amount of a good that is imported. … Because tariffs and quotas ultimately have exactly the same effect on consumers and producers, there is good reason to believe that the two are economically equivalent, as Solicitor General Sauer argues. If that’s the case, why would any government use tariffs when they can instead use quotas?” (11/25/25)