Protectionism - Germany
Luke Kirchner Dr. Quillin IB Econ 10 December 2021 what am i doing Germany has imposed new tariffs on cars, particularly because of the pandemic. Because Germany is the largest car exporter in the world, you would think the demand for car imports in Germany is not that high. However, Germany was the 2nd highest importer of cars, with the total amount coming in at $75 Billion. In 2019, the average tariff for cars was 3.62%. In 2020 however, the tariffs were raised to 4.3%. The effect on the consumer is substantial because it raises the price tag of the automobiles. They will then flock to the lower prices or domestic options, but could cause trouble. Now the surplus is down and they would be keeping their money or facing the higher prices. DOMESTIC PRODUCERS: In theory, the domestic car produces would benefit by this by increasing production to Q3. There is a catch however. Tariffs were also imposed for auto parts, which in turn can effect the e...