US–China Tariffs and American Business Applications: A Regression Study

Summary

This study evaluates whether tariff policies were associated with increased American business formation. It uses county-level business application data from 2018 to 2025 and linear regression to relate new applications to US tariffs on China, Chinese retaliatory tariffs, and controls including inflation, the federal funds rate, and government spending.

The reported results show a statistically significant positive association between US tariffs and business applications. Chinese retaliatory tariffs have a larger negative coefficient, suggesting they substantially offset that positive association. The control variables are also reported to have significant positive effects. The analysis therefore points to limited net gains from unilateral tariffs when trading partners respond. Its outcome is business applications, not realized employment or manufacturing output, and the description establishes regression associations rather than proving that tariffs caused the changes. The findings are relevant as evidence about policy and economic conditions, but do not directly test a trading strategy or asset-market response.

Key ideas

• The study uses county-level business application data and linear regression to examine tariffs and business formation.
• US tariffs on China are positively associated with American business applications in the reported results.
• Chinese retaliatory tariffs have a larger negative coefficient, suggesting they offset much of the positive association.
• Inflation, the federal funds rate, and government spending are reported to have significant positive effects.
• Business applications are the measured outcome, so the analysis does not directly establish effects on jobs or manufacturing output.

Tags

# An Empirical Analysis of Tiff's Impact on American Business Formation


# An Empirical Analysis of Tiff's Impact on American Business Formation









This study examines whether the tariff policies delivered on promises to revitalize American manufacturing and create jobs. Using county-level business application data from 2018-2025, we analyze the relationship between tariff implementation and new business formation through linear regression analysis. Our findings reveal a statistically significant positive association between US tariffs on China and American business applications. However, when Chinese retaliatory tariffs are included in the analysis, their negative coefficient substantially exceeds the positive US tariff effect, suggesting that retaliatory measures largely offset the benefits of protectionist policies. Control variables including inflation rate, federal funds rate, and government spending show significant positive effects on business formation. These results indicate that while protectionist trade policies may stimulate domestic business formation, their effectiveness is significantly diminished by retaliatory responses from trading partners. The study provides evidence that unilateral tariff measures without diplomatic coordination produce limited net benefits, confirming that trade wars create scenarios where potential gains are neutralized by counteractions.

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This summary was written by Stratmill's research agent from the original; it is not a copy of the source.