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The chilling trade effects of antidumping proliferation

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  • Vandenbussche, Hylke
  • Zanardi, Maurizio

Abstract

Advocates of antidumping (AD) laws downplay their negative effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. But while the adverse effect of AD on product-level trade has long been established, the question remains whether there are trade effects at the aggregate level. The recent proliferation wave of AD laws and their use provides us with a unique policy change to estimate the true trade effects of adopting and enforcing AD laws. For this purpose, we estimate the effect of AD on bilateral trade flows between the "new adopters" of AD laws and their trade partners. Using a gravity model of annual observations (1980-2000) our estimates show that AD has trade chilling effects on aggregate import volumes but the impacts are heterogeneous across sectors. We find that new tough users experience a chilling of their aggregate imports of 14 billion US$ a year (or 5.9%) as a result of AD measures. For some countries like Mexico and India, the dampening effects of AD laws on trade flows are found to substantially offset the increase in trade volumes derived from trade liberalization.

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Bibliographic Info

Article provided by Elsevier in its journal European Economic Review.

Volume (Year): 54 (2010)
Issue (Month): 6 (August)
Pages: 760-777

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Handle: RePEc:eee:eecrev:v:54:y:2010:i:6:p:760-777

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Keywords: Antidumping Gravity equation Trade liberalization Trade flows;

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Citations

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Cited by:
  1. Hylke Vandenbussche & Christian Viegelahn, 2011. "No Protectionist Policy Before and During the Great Recession," LICOS Discussion Papers 28511, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  2. Tobias D. Ketterer, 2014. "EU Antidumping and Tariff Cuts: Trade Policy Substitution?," Discussion Papers 2014-05, University of Nottingham, GEP.
  3. Bown, Chad P. & McCulloch, Rachel, 2012. "Antidumping and market competition: implications for emerging economies," Policy Research Working Paper Series 6197, The World Bank.
  4. Bown, Chad P., 2010. "Taking stock of antidumping, safeguards, and countervailingduties, 1990-2009," Policy Research Working Paper Series 5436, The World Bank.
  5. Patricia, Tovar, 2011. "India: The use of temporary trade barriers," MPRA Paper 41054, University Library of Munich, Germany.
  6. Laura ROVEGNO, 2010. "Trade Protection and Market Power: Evidence from US Antidumping and Countervailing duties," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2010043, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  7. Tibor Besedeš & Thomas J. Prusa, 2013. "Antidumping and the Death of Trade," NBER Working Papers 19555, National Bureau of Economic Research, Inc.
  8. C. Carter & S. Mohapatra, 2013. "Inventories and antidumping: the case of orange juice trade," Empirical Economics, Springer, vol. 45(1), pages 247-266, August.
  9. Yi Lu & Zhigang Tao & Yan Zhang, 2013. "How Do Exporters Respond to Antidumping Investigations?," Working Papers 192013, Hong Kong Institute for Monetary Research.
  10. Christian Gormsen, 2011. "Anti-dumping with heterogeneous firms," Economie Internationale, CEPII research center, issue 125, pages 41-64.
  11. Hylke VANDENBUSSCHE & Christian VIEGELAHN, 2011. "No Protectionist Surprises: EU Antidumping Policy Before and During the Great Recession," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2011021, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  12. Feinberg Robert M., 2011. "Antidumping as a Development Issue," Global Economy Journal, De Gruyter, vol. 11(3), pages 1-17, September.
  13. Kubo, Koji, 2013. "Myanmar's non-resource export potential after the lifting of economic sanctions : a gravity model analysis," IDE Discussion Papers 426, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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