The impact of tariff policy on the industrial development of the USA: from protectionism to liberalization (19th - first third of the 20th century)

Abstract

The aim of the article is to clarify how the tariff policy of the United States during the 19th and the first third of the 20th century functioned as a key mechanism of the country's industrial development, and how changes in customs legislation interacted with the transformation of the economic structure of the United States. The study focuses on the hypothesis that tariffs during this period were not merely a fiscal instrument but served as a form of indirect industrial support that enabled the emergence of young industries, the strengthening of the domestic market, the development of industrial clusters, and the formation of a national economic model oriented toward large-scale industrial growth. Particular attention is paid to how, in various historical periods, changes in the level of tariff protection reflected broader economic trends, political conflicts, and institutional reforms that shaped the industrial landscape of the United States.

The article examines the main stages of tariff policy, starting with the early protectionism of the first half of the 19th century and ending with the shift toward reciprocal tariff reductions in the 1930s. It is shown that tariffs in the first half of the 19th century supported the development of young industrial sectors in the absence of a formalized industrial policy and contributed to the formation of the economic base of the North. In the second half of the century, protectionism evolved into a systemic model for sustaining the internal investment cycle, which created conditions for the rise of large corporations, the development of the steel, textile, chemical, and mechanical engineering industries, and the transition of the United States into the Second Industrial Revolution. At the turn of the 19th and 20th centuries, tariff conflicts reflected the contradictions between the interests of big business and the requirements of modernization, which became increasingly important during the Progressive Era (Панченко та Резнікова, 2016). The reduction of tariffs in the early 20th century, combined with the introduction of the federal income tax, marked the transition to a new financial and institutional model in which foreign trade policy ceased to depend on federal budget needs. In the interwar period, rising tariffs and the reaction of international markets demonstrated the vulnerability of the old protectionist model and became one of the factors shaping the policy of cooperation and reciprocity after 1934.

The scientific novelty of the study lies in further developing the understanding of the connection between the evolution of U.S. tariff policy and the formation of the industrial model of the national economy, which makes it possible to characterize tariff policy as a key instrument of U.S. industrialization in the 19th and the first third of the 20th century. The paper shows that changes in the level of tariff protection were not only a response to economic crises or political conflicts but also a form of implementing a long-term development strategy that contributed to the rise of the country's industrial power and its transition to a global economic role in the mid-20th century.