Asymmetric Economic Impact of U.S. Tariffs on Low-Income Countries:  A Focus on South and East Asia

Asymmetric Economic Impact of U.S. Tariffs on Low-Income Countries: A Focus on South and East Asia | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Asymmetric Economic Impact of U.S. Tariffs on Low-Income Countries: A Focus on South and East Asia Hemendra Pal This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7471854/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract This manuscript examines the asymmetric economic effects of U.S. tariffs on developing economies, with a regional focus on South and East Asia — specifically Indiaand Vietnam. Using empirical trade data, regression modeling, and policy analysis, itdemonstrates that U.S. tariffs disproportionately harm lower-income Asian economiesdue to their structural trade dependency, limited fiscal buffers, and institutional fragility.The analysis reveals that identical tariff shocks lead to significantly greater reductionsin GDP growth and export competitiveness in India and Vietnam compared to higherincome countries. These outcomes are supported by quantitative findings showing themagnified impact of tariffs on countries with lower GDP per capita. The paper alsoexplores broader strategic and legal implications for the global trade order, includingthe weakening of WTO norms, the lapse of the Generalized System of Preferences(GSP), and the increasing use of national security exemptions. Policy recommendationsare offered to encourage a development-sensitive U.S. trade strategy that accounts forthe vulnerabilities of Asian economies. Keywords: Trade policy, U.S. tariffs, India, Vietnam, South Asia, East Asia, Tariff Shocks.JEL Classification: F13, O24, F14, F63 JEL Classification: F13, O24, F14, F63 Trade policy U.S. tariffs India Vietnam South Asia East Asia Tariff Shocks Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-7471854","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":506384423,"identity":"9c47c371-5639-46f2-9672-0ecf172a2f4b","order_by":0,"name":"Hemendra Pal","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAAzUlEQVRIiWNgGAWjYBACAwYGxgMJBhI8bOwNIK4FUVoYDnyosJHj4zkA4koQp+XgjDNpxnISCSA+EVrMpZsfHOZtO5zYJvn86oYfBRIM/O3dCXi1WM45ZgDRIp1TdrMH6DCJM2c34HfYjQS4lrQbPEAtBhK5hLSkf4A67EzazT/EackxAHufTYL92G3ibLlzpgAcyGw8OWy3ZYARRNgvt9s3PgBFpXz78Wc33/yxkeNv78WvBSkieAzAJH7lqFrYHxBWPQpGwSgYBSMSAADHfE2w+tZwNAAAAABJRU5ErkJggg==","orcid":"","institution":"Royal Holloway University of London","correspondingAuthor":true,"prefix":"","firstName":"Hemendra","middleName":"","lastName":"Pal","suffix":""}],"badges":[],"createdAt":"2025-08-27 12:53:26","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-7471854/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-7471854/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":92406340,"identity":"d34219d6-f519-44f3-aba6-477541f43bd6","added_by":"auto","created_at":"2025-09-29 11:17:05","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":494110,"visible":true,"origin":"","legend":"","description":"","filename":"TariffsandAsymmetryAnonymous.pdf","url":"https://assets-eu.researchsquare.com/files/rs-7471854/v1_covered_a4f0c24a-7116-471e-a54c-e447568770a4.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Asymmetric Economic Impact of U.S. Tariffs on Low-Income Countries: A Focus on South and East Asia","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":true,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Trade policy, U.S. tariffs, India, Vietnam, South Asia, East Asia, Tariff Shocks","lastPublishedDoi":"10.21203/rs.3.rs-7471854/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-7471854/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis manuscript examines the asymmetric economic effects of U.S. tariffs on developing economies, with a regional focus on South and East Asia — specifically Indiaand Vietnam. Using empirical trade data, regression modeling, and policy analysis, itdemonstrates that U.S. tariffs disproportionately harm lower-income Asian economiesdue to their structural trade dependency, limited fiscal buffers, and institutional fragility.The analysis reveals that identical tariff shocks lead to significantly greater reductionsin GDP growth and export competitiveness in India and Vietnam compared to higherincome countries. These outcomes are supported by quantitative findings showing themagnified impact of tariffs on countries with lower GDP per capita. The paper alsoexplores broader strategic and legal implications for the global trade order, includingthe weakening of WTO norms, the lapse of the Generalized System of Preferences(GSP), and the increasing use of national security exemptions. Policy recommendationsare offered to encourage a development-sensitive U.S. trade strategy that accounts forthe vulnerabilities of Asian economies. Keywords: Trade policy, U.S. tariffs, India, Vietnam, South Asia, East Asia, Tariff Shocks.JEL Classification: F13, O24, F14, F63\u003c/p\u003e\n\u003cp\u003e\u003cstrong\u003eJEL Classification:\u003c/strong\u003e F13, O24, F14, F63\u003c/p\u003e","manuscriptTitle":"Asymmetric Economic Impact of U.S. Tariffs on Low-Income Countries: A Focus on South and East Asia","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-08-28 03:25:09","doi":"10.21203/rs.3.rs-7471854/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"4a0eca93-db4c-434e-8ff8-1db288bcd49b","owner":[],"postedDate":"August 28th, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[],"tags":[],"updatedAt":"2025-09-29T11:08:53+00:00","versionOfRecord":[],"versionCreatedAt":"2025-08-28 03:25:09","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-7471854","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-7471854","identity":"rs-7471854","version":["v1"]},"buildId":"8U1c8b4HqxoKbykW_rLl7","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}