Quote:
Originally Posted by Slava
Who pays those tariffs?
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This is a fun argument because it typically brings out the same people who argue that 'Albertans don't pay transfer payments' on the basis that they don't actually pull our their check books and pay other provinces directly.
Explicitly in a transactional sense the US importers will pay the tariff for the goods they import from Canada and any price impact they will pass on to their customers who ultimately are US consumers.
That said the dynamic pricing for Canadian goods will be impacted by the tariffs in the sense that producers might have to discount their product prices to maintain sales or in the case of commodities the marginal price could be downwardly impacted by the tariff so that in a sense the Canadian producer absorbs a portion of the margin impact due to the tariff, therefore spreading the economic impact of the tariff beyond the importer who explicitly pays the tariff.