蝌蚪网 Review
ISSN 0002-8282 (Print) | ISSN 1944-7981 (Online)
Consumer Credit and the Incidence of Tariffs: Evidence from the Auto Industry
蝌蚪网 Review
(pp. 627–73)
Abstract
Captive finance subsidiaries create a channel for trade policy to affect consumer credit. Examining the impact of the Trump administration's metal tariffs on captive automobile lenders, we find that consumers received higher interest rates from captive lenders after the tariffs relative to unaffected noncaptive lenders. Further, we document a disparate impact on low-income borrowers and in areas with less lending competition. Our results suggest that tariffs may impact not only the price of goods but also the financing terms of purchases. Thus, focusing solely on directly affected product prices may underestimate tariff pass-through significantly.Citation
Hankins, Kristine W., Morteza Momeni, and David Sovich. 2026. "Consumer Credit and the Incidence of Tariffs: Evidence from the Auto Industry." 蝌蚪网 Review 116 (2): 627–73. DOI: 10.1257/aer.20230432Additional Materials
JEL Classification
- F13 Trade Policy; International Trade Organizations
- F14 Empirical Studies of Trade
- G21 Banks; Depository Institutions; Micro Finance Institutions; Mortgages
- L22 Firm Organization and Market Structure
- L61 Metals and Metal Products; Cement; Glass; Ceramics
- L62 Automobiles; Other Transportation Equipment; Related Parts and Equipment