Smoot-Hawley Tariff Act

Smoot-Hawley Tariff Act in Global Commerce Policy

In this regard, a definition of this issue is as follows: the 1930 United States Tariff Act. The entries on trade policy are here. It was passed at the onset of the Great Depression and is remembered for having raised tariffs to the highest level in United States history. The tariff rates specified by this Act, like those of its predecessor, the Tariff Act of 1909, were fixed and could not be reduced through negotiation. The entries on trade policy are here. It was amended in 1934 by the Reciprocal Trade Agreements Act. This launched the Reciprocal Trade Agreements Program which permitted negotiated tariff reductions. The effect on international trade of the Smoot-Hawley tariff is still being debated. There is a widespread belief, expressed in many economic histories, that it was one of the major causes of the deepening recession. The entries on trade policy are here. As far as the United States economy is concerned, this may be a misreading of the influence of the higher tariff. The entries on trade policy are here. At that time, United States imports only amounted to about 6% of gross national product. The entries on trade policy are here. In any case, the full domestic impact of the tariff was not felt until the Depression had become chronic. Countries for whom the United States was a major market were of course very much affected by the higher rates. Regardless of the effect of the Act on trade, it was symptomatic of the beggar-thy-neighbour policies pursued by many countries in the inter-war years. The Smoot-Hawley tariff rates are still in force, and they apply to products from countries not receiving most-favoured-nation treatment by the United States, i.e. countries with which the United States does not have normal trade relations. This act also bans the import into the United States of goods produced by prison labour, forced or indentured labour. See also autonomous tariff, Section 337 and United States Reciprocal Trade Agreements Program.[1]

Smoot-Hawley Tariff Actin the wold Encyclopedia

For an introductory overview on international trade policy, see this entry.

Resources

Notes and References

1. Dictionary of Trade Policy, “Smoot-Hawley Tariff Act” entry (OAS)

See Also