Which U.S. states would be hit hardest by 25% tariffs on Mexico and Canada? An economist did the math

Since the estimates do not factor in potential retaliatory measures from Mexico or Canada, they should be considered lower-bound economic impact estimates.

A table showing the effects of 25% tariffs on Mexico and Canada on different state economies.
Analysis by Badessa Tadesse. Estimates are based on state-level trade data from the U.S. Census Bureau and Population Estimates (2023) and data from the Bureau of Economic Analysis on state industries. The model assumes a 70% tariff pass-through rate, indicating that American businesses and consumers shoulder most tariff costs. Conversely, 30% is absorbed within the supply chain based on historical trends. It also incorporates a 10% import substitution rate, reflecting a modest shift to alternative suppliers due to the complexities of North American supply chains, alongside a price elasticity of demand of -0.5, illustrating how consumers and businesses respond to price changes. The model also assumes a uniform impact across all import categories within states.
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