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Eighteen months have passed since the United States entered a trade war with Canada. From vowing to impose 25% tariffs on Canadian goods on his first day in office to now threatening to enact 50% tariffs on a slew of Canadian products effective on August 19, Trump’s policies have coincided with growing tensions between the two neighbours.

And it seems this tension is beginning to influence Canadians’ behaviour. Over the past year and a half, Statistics Canada reported a steep decline in Canadian tourism to the US. Recent surveys have suggested the political climate to be a major driving force in that drop.

That shifting attitude among Canadian consumers towards the US, which some have characterized as a boycott, is having measurable impacts south of the border, according to Philip Luck, who directs the Economics Program and Scholl Chair in International Business at the Center for Strategic and International Studies in Washington, DC.

Luck argues in The Walrus that the drop in Canadian tourism to the US has resulted in significant earning losses in border communities, whose economies are most tied to Canada. He estimates the decline in tourism has cost American border communities “between 10,000 and 30,000 leisure and hospitality jobs, with associated earnings losses of $0.5 to $1 billion per year.” Most of the employment and wage losses, he adds, are concentrated in a very small number of communities.

Could a deal between Washington and Ottawa on tariffs reverse that trend? Not so fast, Luck says. “Once consumers in a democratic society organize around a grievance,” he writes, “state-to-state economic statecraft cannot reliably dictate their behaviour.”

“Economists have long understood that coercive, unilateral tariffs invite retaliation and that the resulting trade diversion and welfare losses fall on both sides, producing a suboptimal and difficult-to-rectify equilibrium,” Luck says. “This episode reveals a less-examined cost: the coercer pays too. It pays not only through the game theory of state-to-state action but through the independent choices of citizens who feel affronted by the great game their statesmen are playing.”

Learn more about how Trump’s tariffs on Canadian exports could be impacting American workers in border towns