Rolling for Initiative is a weekly column by Scott Thorne, PhD, owner of Castle Perilous Games & Books in Carbondale, Illinois and instructor in marketing at Southeast Missouri State University. This week, Thorne discusses a recent study on U.S. tariffs conducted by the Kiel Institut in Germany.
As I briefly mentioned in last week’s column (see “Packing Slips“), a study published last month confirms that the vast majority of the U.S. administration’s tariffs are paid by the American buying public The study, conducted by Germany’s Kiel Institut, looked at over 24 million transactions made during 2025 (totaling nearly $4 trillion dollars) and found, to no one’s surprise, Americans paid almost all of them.
The researchers found that 96% of all tariffs collected were paid by American companies and consumers, and only 4% were absorbed by exporters. Customs revenue generated by tariffs in 2025 approximated $200 billion dollars, two and a half times the $80 billion collected in tariff revenue in 2024.
The study also mentioned the 2018-2019 trade war with China, also instigated by the U.S. administration, and compares it to the effects of the 2025 tariffs. Research on those tariffs discovered that U.S. import prices rose on a nearly one-for-one basis with the tariffs. Chinese export prices remained largely unchanged, meaning a nearly 100% pass through rate on the tariffs imposed during that period, much like the tariffs imposed in 2025. Despite the new trade barriers, Chinese exporters did not cut prices in order to maintain market share. Instead, China manufacturers reduced trade volume with the U.S.
Typically, the appropriate response in a situation like this would have been for the manufacturers to cut prices, but they did not. Analysis indicated two major reasons for this. First off, for many products, there were no close substitutes readily available from non-tariffed sources, so no need to eat the tariffs to compete. Second and perhaps more important, the structure of global supply chains meant that many U.S. importers had already optimized their sourcing and could not easily switch suppliers in the short run.
As I have pointed out in the past, China has designed much of its production capabilities to create efficiencies in the manufacturing process and supply chain, making it a time-consuming process for a publisher to shift operations from China to another source with less exposure to tariffs (see “Tariffs—Take Two“). Happening on a much larger scale, both the Chinese and U.S. markets replicated this behavior.
For a further comparison, the study also looked at the effects of the 2025 tariffs on exports from both Brazil and India, a 50% tariff on Brazilian exports and a 25% tariff, later raised to 50%, on India. In both cases, the researchers found no decrease in price on exports from either country to the United States. All the cost of the tariffs, as with China, was passed through to American importers and consumers, and trade volume decreased. Exporters from all three countries showed a significant drop in trade volume with the U.S. as exporters from those countries found other markets to which to ship.
The study came up with five conclusions:
#1 – Tariffs are almost wholly a tax on American consumers.
#2 – the tariffs transferred approximately $200 billion from American consumers to the U.S. Treasury, costing the average household an additional $1,000.
#3 – Tariffs are adjusting trade volume, not prices of goods.
#4 – American manufacturers supply chains bear additional stress and cost.
#5 – The same results that came from the 2018-2019 trade war have occurred in 2025. There is no evidence the trade dynamics of 2018-209 have changed in 2025.
Comments? Send them to castleperilousgames@gmail.com.
The opinions expressed in this column are solely those of the writer, and do not necessarily reflect the views of the editorial staff of ICv2.com.
Source: ICv2
