Antidumping Policy

Abstract

JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact support@jstor.org.When an antidumping policy involves the imposition of duties, the threat of antidumping enforcement may alter strategic behavior under imperfect competition. This point is illustrated in a model where the foreign firm is a monopolist in its local market, but competes with a domestic firm in the home country's market. The welfare effects of an antidumping policy are examined under quantity-setting and price-setting behavior with either perfect or imperfect substitutes. Imposing an antidumping policy frequently improves domestic welfare'under quantity-setting behavior, and typically worsens it under price-setting behavior. Surprisingly, foreign welfare may improve.

Antidumping, Intra‐industry Trade, and Quality Reversals

“…Various papers (see e.g. Ethier and Fisher, 1987;Fisher, 1992;Leidy and Hoekman, 1990;Reitzes, 1993) have examined how AD protection gives firms incentives to alter their price or output decisions vis-à-vis free trade in order to influence the AD outcome. This may lead to higher or lower welfare depending on the existing market structure.…”

The Cost of Antidumping: the Devil is in the Details

“…Ethier and Fischer (1987), Fischer (1992) and Reitzes (1993) broaden the focus on strategic behavior by examining oligopoly games involving both a foreign and domestic firm. In the context of the above general model, these papers set n=2 and model the actions as firms setting prices or quantities.…”

“…We stress the word "may" in the previous sentences because, as Fischer (1992) shows, even these results may be reversed for various games of price or quantities, depending on other market conditions. In addition, a wider variety of outcomes occur if one considers a game in prices with perfectly substitutable goods, as in Reitzes (1993), or if one examines these games when the dumping margin is calculated using a cost-based approach, as analyzed by Fischer (1992).…”

TRADE POLICY STRATEGIES AND ENFORCEMENT CHOICES: An Examination of the 1992 Steel Antidumping Cases

“…Reitzes (1993) found that the threat of antidumping enforcement may alter strategic behavior under imperfect competition. Firm behavior may be altered by the mere threat of antidumping enforcement (1993).…”