Deindustrialization and the Demand for Protection

Abstract

Current explanations of demand for anti-dumping protections focus on the role of the business cycle, and fluctuations in real exchange rates. However, empirical evidence supporting these explanations is based primarily on the experience of industrialized countries. Here, we examine anti-dumping petitions in a broader sample of thirty-four industrialized and middle income countries from 1978–2015. We also propose a new determinant of demand for anti-dumping petitions—changes in the pattern of industrial production between developed and developing economies over this period have contributed to deindustrialization in advanced economies and premature industrialization some developing countries. These changes threaten established industries and motivate them to demand protection.

Antidumping Protectionism and Globalized Economies

“…I treat these petitions as individual cases, as these are separate instances of firms directly demanding antidumping trade remedies from domestic governments. Recent research has also employed this approach-see Ba and Coleman (2021). Also see Upadhayay (2021) for a similar approach.…”

“…"Economic Crisis" is a dichotomous variable that captures systemic economic and financial shocks occurring within a given country. This variable receives a value of 1 if a jarring financial shock occurred within a country during 97 Ba and Coleman, (2021); also see Signoret et al (2020). 98 Mansfield, Milner, and Rosendorff (2000); Milner and Kubota (2005).…”

“…For the most part, South Korea managed to weather the financial pandemic. However, fears of a financial meltdown may have caused Korean firms to anticipate oncoming economic troubles, 58 Plunkert (1990); Ba and Coleman (2021). 59 ibid., 269.…”

An Emerging Factor in Turkish Anti-Dumping Policy: Additional Customs Duty 

“…The countries with higher income levels are likely to initiate more AD investigations and retaliation motives are quite significant among the determinants of anti-dumping investigations. Ba and Coleman (2021) discusses anti-dumping decisions and evaluate protection demand in a de-industrialized world and integrated supply chains environment. It investigates the de-industrialization dynamics in anti-dumping petitions using a sample size of 34 industrialized and middle-income countries from 1978-2015.…”

“…Negative Binomial Real GDP growth rates of the country subject to AD investigation, its import share in Turkish total imports and share of Turkish exports to that country in overall exports found to be statistically significant in determining the number of AD investigations. Ba and Coleman (2021) 1978-2015, 34 countries Negative Binomial Changes in exchange rates and effect of retaliation motives are found to be important elements behind anti-dumping investigations. Deindustrialization in advanced economies is also found as an emerging factor for anti-dumping demand.…”