Using a newly created microeconomic archive of U.S. imports at the tariff-line level, we investigate the role of the Hawley-Smoot Tariff in generating consumption and production inefficiencies.

We introduce the real exchange rate volatility curve as a useful device to understand the role of price stickiness in accounting for deviations from the Law of One Price at the sector level. In the presence of both nominal and real shocks, the theory predicts that the real exchange rate...