By Admin 
Regarding the impact of US tariffs, Geeta Gopinath, former deputy managing director and economist of the International Monetary Fund (IMF), said that its results point to a disturbing reality for American consumers. Geeta Gopinath posted on X that an IMF working paper shows that the tariffs imposed by America in 2025 have had very little impact on foreign exporters. Instead, American buyers mostly turned to cheaper suppliers, whose products were often of lower quality.
The IMF working paper, written by economists Jabin Ahn, Lorenzo Rotunno and Michel Ruta, analyzed detailed US census data on imports and tariffs between February and December 2025. Researchers examined how tariff increases affected prices, sourcing decisions and product quality of thousands of goods.
The study revealed that foreign exporters did not reduce prices in response to US tariffs. If we look at the detailed information at the product level, even after the tariff increase, export prices remained almost the same. This meant that the additional costs incurred due to tariffs were passed on to importers and buyers in the US. The study found that average tariff rates increased by about 8 percent during the period examined, leading to a decline in imports of about 3.6%.
What does the IMF study say?
Following the tariff increase, higher priced suppliers were more likely to leave the US market, while lower priced suppliers were more likely to enter. According to the study, about 65% of the decline in prices was due to this pattern of change in suppliers. Researchers argue that lower prices do not always mean better value.
Examining data from 2023 and 2024, they found that many new suppliers attracting American buyers had low appeal scores. When these quality-related differences were taken into account, much of the apparent price advantage disappeared. The study estimates that about half of the observed price decline after the 2025 tariffs was actually due to a shift towards lower-quality suppliers.
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