Trade Liberalization, Macroeconomic Fluctuations, and Contingent Protection in Latin America
AbstractThe main purpose of this paper is to analyze the main determinants of antidumping actions in Latin America. From a policy perspective, it would be interesting to know whether the application of trade remedy instruments was associated with episodes of a depressed level of economic activity or real exchange rate appreciations or both. These developments favor the finding of industry injury and dumping practices, making the case for antidumping more justifiable. An alternative hypothesis is that antidumping measures have been erected simply as replacements for formal tariff protection so that there should be a negative relationship between antidumping measures and tariff levels. Moreover, antidumping actions may be associated less with macroeconomic variables affecting injury and dumping and more with political economy-type variables such as industry concentration. The main purpose of this study is to investigate these hypotheses employing a very detailed database for the three main antidumping countries in Latin America: Argentina, Brazil, and Mexico. We find support for the hypothesis that in these countries contingent protection has been employed to protect domestic industries in times of macroeconomic hardship. In particular, real exchange rate appreciations and sluggish GDP growth is associated with increasing antidumping actions. The estimated quantitative impact seems quite significant: on average a real appreciation of 25 percent raises expected antidumping initiations by about 20 percent. Also a 4 percentage point decline in GDP raises expected antidumping activity by 27 percent. Besides these macrodeterminants, we also investigate whether antidumping actions were established to replace protection given by regular tariffs or whether they were affected by political economy variables such as industry concentration We find some evidence consistent with the first proposition but not with the second.
Download InfoIf 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.
Bibliographic InfoArticle provided by LACEA - LATIN AMERICAN AND CARIBBEAN ECONOMIC ASSOCIATION in its journal Journal of LACEA Economia.
Volume (Year): (2006)
Issue (Month): ()
Contact details of provider:
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statisticsgeneral 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: (Carolina Prada Gutiérrez).
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.