Advanced Search
MyIDEAS: Login

Tariff-jumping FDI and domestic firms' profits

Contents:

Author Info

  • Bruce Blonigen
  • KaSaundra Tomlin
  • Wesley Wilson

Abstract

Studies of trade policy welfare effects often ignore the potential for tariff-jumping foreign direct investment (FDI) to mitigate positive gains to domestic producers. Using event study methodology we find that affirmative U.S. antidumping decisions are associated with average abnormal gains of over 3% to a firm in the petitioning industry in the absence of tariff-jumping FDI, but much smaller and statistically insignificant abnormal gains if there is tariff-jumping FDI. We also find evidence that tariff jumping in the form of new plants or plant expansion has significantly larger negative effects on U.S. domestic firms' profits than other types of tariff-jumping FDI.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://economics.ca/cgi/xms?jab=v37n3/07.pdf
File Function: Full text
Download Restriction: Available to subscribers only. Alternative access through JSTOR and Ingenta.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Bibliographic Info

Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 37 (2004)
Issue (Month): 3 (August)
Pages: 656-677

as in new window
Handle: RePEc:cje:issued:v:37:y:2004:i:3:p:656-677

Contact details of provider:
Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
Email:
Web page: http://economics.ca/cje/
More information through EDIRC

Order Information:
Email:
Web: http://economics.ca/en/membership.php

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Kelly, Kenneth H & Morkre, Morris E, 1998. "Do Unfairly Traded Imports Injure Domestic Industries?," Review of International Economics, Wiley Blackwell, vol. 6(2), pages 321-32, May.
  2. Brander, James A. & Spencer, Barbara J., 1987. "Foreign direct investment with unemployment and endogenous taxes and tariffs," Journal of International Economics, Elsevier, vol. 22(3-4), pages 257-279, May.
  3. Hartigan, James C & Perry, Philip R & Kamma, Sreenivas, 1986. "The Value of Administered Protection: A Capital Market Approach," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 610-17, November.
  4. René Belderbos, 1997. "Antidumping and tariff Jumping: Japanese firms’ DFI in the European union and the United States," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 133(3), pages 419-457, September.
  5. Bruce A. Blonigen & Robert C. Feenstra, 1997. "Protectionist Threats and Foreign Direct Investment," NBER Chapters, in: The Effects of U.S. Trade Protection and Promotion Policies, pages 55-80 National Bureau of Economic Research, Inc.
  6. Barrell, Ray & Pain, Nigel, 1999. "Trade restraints and Japanese direct investment flows," European Economic Review, Elsevier, vol. 43(1), pages 29-45, January.
  7. Borenstein, Severin & Zimmerman, Martin B, 1988. "Market Incentives for Safe Commercial Airline Operation," American Economic Review, American Economic Association, vol. 78(5), pages 913-35, December.
  8. James Levinsohn & Steven Berry & Ariel Pakes, 1999. "Voluntary Export Restraints on Automobiles: Evaluating a Trade Policy," American Economic Review, American Economic Association, vol. 89(3), pages 400-430, June.
  9. Saxonhouse, Gary R, 1976. "Estimated Parameters as Dependent Variables," American Economic Review, American Economic Association, vol. 66(1), pages 178-83, March.
  10. Anderson, James E., 1993. "Domino dumping II: Anti-dumping," Journal of International Economics, Elsevier, vol. 35(1-2), pages 133-150, August.
  11. Levinsohn, James A., 1989. "Strategic trade policy when firms can invest abroad: When are tariffs and quotas equivalent?," Journal of International Economics, Elsevier, vol. 27(1-2), pages 129-146, August.
  12. Motta, Massimo, 1992. "Multinational firms and the tariff-jumping argument : A game theoretic analysis with some unconventional conclusions," European Economic Review, Elsevier, vol. 36(8), pages 1557-1571, December.
  13. Ruback, Richard S., 1982. "The effect of discretionary price control decisions on equity values," Journal of Financial Economics, Elsevier, vol. 10(1), pages 83-105, March.
  14. Blonigen, Bruce A., 2002. "Tariff-jumping antidumping duties," Journal of International Economics, Elsevier, vol. 57(1), pages 31-49, June.
  15. Smith, Alasdair, 1987. "Strategic investment, multinational corporations and trade policy," European Economic Review, Elsevier, vol. 31(1-2), pages 89-96.
  16. Haaland, J.I. & Wooton, I., 1995. "Anti-Dumping Jumping: Reciprocal Anti-Dumping and Indutrial Location," Papers 22/95, Norwegian School of Economics and Business Administration-.
  17. A. Craig MacKinlay, 1997. "Event Studies in Economics and Finance," Journal of Economic Literature, American Economic Association, vol. 35(1), pages 13-39, March.
  18. Ellingsen, T. & Warneryd, K., 1993. "Foreign direct investment and the political economy of protection," Discussion Paper 1993-8, Tilburg University, Center for Economic Research.
  19. Ries, John C, 1993. "Windfall Profits and Vertical Relationships: Who Gained in the Japanese Auto Industry from VERs?," Journal of Industrial Economics, Wiley Blackwell, vol. 41(3), pages 259-76, September.
  20. Prusa, Thomas J., 1992. "Why are so many antidumping petitions withdrawn?," Journal of International Economics, Elsevier, vol. 33(1-2), pages 1-20, August.
  21. Murray, Tracy & Rousslang, Donald J., 1989. "A method for estimating injury caused by unfair trade practices," International Review of Law and Economics, Elsevier, vol. 9(2), pages 149-164, December.
  22. Flam, Harry, 1994. "EC members fighting about surplus VERs, FDI and Japanese cars," Journal of International Economics, Elsevier, vol. 36(1-2), pages 117-131, February.
  23. Hartigan, James C & Kamma, Sreenivas & Perry, Philip R, 1989. "The Injury Determination Category and the Value of Relief from Dumping," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 183-86, February.
  24. Rosendorff, B Peter, 1996. "Voluntary Export Restraints, Antidumping Procedure, and Domestic Politics," American Economic Review, American Economic Association, vol. 86(3), pages 544-61, June.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Matthew T. Cole (University College Dublin) Ronald B. Davies (University College Dublin), 2009. "Optimal Tariffs, Tariff Jumping, and Heterogeneous Firms," The Institute for International Integration Studies Discussion Paper Series iiisdp302, IIIS.
  2. Fung, K.C. & Korhonen, Iikka & Li, Ke & Ng, Francis, 2008. "China and Central and Eastern European Countries: Regional networks, global supply chain or international competitors?," BOFIT Discussion Papers 9/2008, Bank of Finland, Institute for Economies in Transition.
  3. Jota Ishikawa & Kaz Miyagiwa, 2006. "Price Undertakings, VERs, and Foreign Direct Investment," Emory Economics 0616, Department of Economics, Emory University (Atlanta).
  4. Henk Kox & Arjan Lejour & Raymond Montizaan, 2004. "The free movement of services within the EU," CPB Document 69, CPB Netherlands Bureau for Economic Policy Analysis.
  5. Anwar, Sajid & Nguyen, Lan Phi, 2011. "Foreign direct investment and trade: The case of Vietnam," Research in International Business and Finance, Elsevier, vol. 25(1), pages 39-52, January.
  6. Gurun, Ayfer, 2013. "Business strategy and financial consequences: The case of antidumping filings," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 24(C), pages 127-138.
  7. Farshid Pourshahabi & Ehsan Salimi Soderjani & Davood Mahmoudinia, 2013. "Panel Causality Relationship among FDI and Trade (Evidence from 16 Advanced Europe Countries)," Iranian Economic Review, Economics faculty of Tehran university, vol. 18(1), pages 115-133, winter.
  8. Chiara Franco & Francesco Rentocchini & Giuseppe Vittucci Marzetti, 2008. "Why do firms invest abroad? An analysis of the motives underlying Foreign Direct Investments," Department of Economics Working Papers 0817, Department of Economics, University of Trento, Italia.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:cje:issued:v:37:y:2004:i:3:p:656-677. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Prof. Werner Antweiler).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.