Knowledge Tree
average effective tariff rate
Also known as: AETR
Facts (29)
Sources
Tariffs: Estimating the Economic Impact of the 2025 Measures and ... richmondfed.org Apr 2, 2025 25 facts
measurementUnder the Richmond Fed's 'Scenario 2' tariff model, Canada's Average Effective Tariff Rate (AETR) increases to 11.9 percent, while Mexico's AETR rises to 15.5 percent.
measurementUnder Scenario 3, which includes a 25 percent tariff on all auto imports, the nationwide Average Effective Tariff Rate (AETR) in the United States rises to 12.4 percent.
measurementThe implementation of the Richmond Fed's 'Scenario 3' tariff model causes the overall Average Effective Tariff Rate (AETR) to increase from 10.4 percent to 12.4 percent.
measurementThe Average Effective Tariff Rate (AETR) could rise from 2.2 percent in the benchmark scenario to 17.0 percent under the most aggressive 2025 tariff proposal (Scenario 4).
claimThe average effective tariff rate (AETR) is a metric used to assess the impact of proposed tariffs by aggregating tariffs across various imported goods and countries into a single number.
referenceThe benchmark Average Effective Tariff Rate (AETR) of 2.2 percent incorporates World Trade Organization (WTO) most-favored-nation (MFN) tariffs, China-specific tariffs imposed during the 2018-19 period, and other tariff measures or exemptions in effect.
measurementThe increase in the average effective tariff rate during 2018-19 resulted in roughly a 0.3 percent rise in the U.S. consumer price index.
measurementIn a simulated scenario involving a uniform tariff on European Union imports, the Average Effective Tariff Rate (AETR) for United States imports from the European Union would increase from 4.4 percent to 29.4 percent.
measurementUnder Scenario 1, the Average Effective Tariff Rate (AETR) for goods imported from China rises to 33.5 percent.
measurementThe Richmond Fed's 'Scenario 2' economic model adds 25 percent tariffs on goods imported from Canada and Mexico that are not covered under the USMCA, resulting in an overall Average Effective Tariff Rate (AETR) increase from 7.1 percent to 10.4 percent.
procedureThe method for estimating Average Effective Tariff Rates (AETRs) at the county level involves weighting the tariff faced by each industry by its employment share in the county and then aggregating across all industries in that county.
measurementUnder the Richmond Fed's 'Scenario 3' tariff model, Mexico's Average Effective Tariff Rate (AETR) rises to 20.1 percent, Canada's AETR rises to 14.1 percent, and the European Union's AETR increases from 2.5 percent to 4.4 percent.
measurementIn the benchmark scenario constructed using 2024 U.S. Trade Census data, the average effective tariff rate (AETR) is 2.2 percent, meaning the government collected 2.2 cents in tariff revenue for every dollar of imported goods.
claimManufacturing and mining industries face the highest exposure under the proposed 2025 tariffs according to the Richmond Fed's AETR analysis.
procedureThe average effective tariff rate (AETR) is computed by weighting the tariff imposed on each good imported from each country by that good-country combination's share of total imports.
measurementUnder the Richmond Fed's 'Scenario 3' tariff model, China's Average Effective Tariff Rate (AETR) remains unchanged at 33.5 percent because automobiles from China were already subject to elevated tariffs under prior scenarios.
referenceThe authors of the Richmond Fed Economic Brief construct a benchmark average effective tariff rate (AETR) using 2024 U.S. Trade Census data, following the methodology established by Michael Waugh.
measurementIn Scenario 1, the Average Effective Tariff Rate (AETR) for Canada rises from 0.1 percent to 1.5 percent, and the AETR for Mexico rises from 0.2 percent to 2.8 percent.
claimScenario 4 introduces a 25 percent tariff on all European Union imports in addition to the measures in Scenario 3, which intensifies and widens economic exposure to tariffs across the United States, with Average Effective Tariff Rates (AETRs) exceeding 10 percent and in some cases reaching above 14 percent.
measurementThe benchmark Average Effective Tariff Rate (AETR) for the United States at the end of 2024 was 2.2 percent.
claimThe average effective tariff rate (AETR) is a metric that reflects the average tariff paid across all imports.
measurementUnder the proposed Scenario 2 tariff package, the overall Average Effective Tariff Rate (AETR) for United States imports is projected to increase from 7.1 percent to 10.4 percent.
formulaThe average effective tariff rate (AETR) is defined as the ratio of duties (tariff revenue collected) to imports (the dollar value of goods imported), expressed as AETR = duties / imports.
measurementThe Richmond Fed's 'Scenario 4' economic model introduces a 25 percent tariff on all imports from the European Union, causing the overall Average Effective Tariff Rate (AETR) to increase from 12.4 percent to 17.0 percent.
measurementThe simulated aggressive tariff package results in an overall Average Effective Tariff Rate (AETR) of 17.0 percent across most manufacturing sectors.
Academic Paper: The Future of Trade Wars in Trump's Foreign Policy eng.alzaytouna.net Jun 2, 2025 4 facts
measurementAdding a 25% tariff on all imports from the European Union to previous tariff measures raises the average effective tariff rate (AETR) to 17.0%.
measurementApplying 25% tariffs on imports from Canada and Mexico that fall outside the US-Mexico-Canada Agreement coverage raises the average effective tariff rate (AETR) to 10.4%.
measurementAs of March 2025, the implementation of 20% tariffs on all Chinese imports and 25% tariffs on aluminum and steel increased the average effective tariff rate (AETR) to 7.1%.
measurementApplying 25% auto tariffs lifts the average effective tariff rate (AETR) to 12.4%, with country-level AETRs reaching 30% for Mexico and 20% for Canada.