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Policy externalities: How US antidumping affects Japanese exports to the EU

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  • Bown, Chad P.
  • Crowley, Meredith A.

Abstract

This paper investigates the international externalities associated with US use of antidumping (AD) measures by examining the relationship between US AD duties (ADDs) and Japanese exports to the US and EU over the 1992-2001 period. We first examine the trade destruction and trade diversion associated with Japanese exports to the US market resulting from US AD duties. We then investigate whether US ADDs impose externalities on a non- targeted third country by examining the effect of these US policies on Japanese exports to the EU. We document sizable trade deflection and trade depression in the EU market resulting from US ADDs. Model estimates indicate that, on average, roughly one quarter to one third of the value of Japanese exports to the US thought to be destroyed by a US ADD is actually deflected to the EU in the form of a contemporaneous increase in exports. Finally, we present evidence that US ADDs impose terms-of-trade externalities on non-targeted markets. We find that US duties on Japanese exports are associated with substantially lower Japanese export prices in the EU market.

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Bibliographic Info

Article provided by Elsevier in its journal European Journal of Political Economy.

Volume (Year): 22 (2006)
Issue (Month): 3 (September)
Pages: 696-714

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Handle: RePEc:eee:poleco:v:22:y:2006:i:3:p:696-714

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Web page: http://www.elsevier.com/locate/inca/505544

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References

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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.:
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  1. Bagwell, Kyle & Mavroidis, Petros C. & Staiger, Robert W., 2004. "The case for tradable remedies in WTO dispute settlement," Policy Research Working Paper Series 3314, The World Bank.
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  19. Bown, Chad P., 2005. "Trade remedies and World Trade Organization dispute settlement : Why are so few challenged?," Policy Research Working Paper Series 3540, The World Bank.
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Citations

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Cited by:
  1. Zissimos, Ben, 2009. "Optimum tariffs and retaliation: How country numbers matter," Journal of International Economics, Elsevier, vol. 78(2), pages 276-286, July.
  2. Yi Lu & Zhigang Tao & Yan Zhang, 2013. "How Do Exporters Respond to Antidumping Investigations?," Working Papers 192013, Hong Kong Institute for Monetary Research.
  3. 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).
  4. Chandra, Piyush & Long, Cheryl, 2013. "Anti-dumping Duties and their Impact on Exporters: Firm Level Evidence from China," World Development, Elsevier, vol. 51(C), pages 169-186.
  5. Juha Tervala & Giovanni Ganelli, 2012. "Tariff-Tax Reforms in Large Economies," IMF Working Papers 12/139, International Monetary Fund.
  6. Veysel Avsar, 2013. "Antidumping, Retaliation Threats, and Export Prices," World Bank Economic Review, World Bank Group, vol. 27(1), pages 133-148.
  7. Bagwell, Kyle & Mavroidis, Petros C. & Staiger, Robert W., 2007. "Auctioning countermeasures in the WTO," Journal of International Economics, Elsevier, vol. 73(2), pages 309-332, November.
  8. Marta dos Reis Castilho, 2009. "Documentos IPEA/CEPAL - Antidumping nas Américas: Uma Investigação dos Efeitos do Uso desse Instrumento sobre as Exportações e sobre a Conduta das Empresas Brasileiras," Discussion Papers 1382, Instituto de Pesquisa Econômica Aplicada - IPEA.
  9. Hylke Vandenbussche & Ziga Zarnic, 2008. "US Safeguards on Steel and the Markups of European Producers," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 144(3), pages 458-490, October.
  10. Lu, Yi & Tao, Zhigang & Zhang, Yan, 2012. "How exporters respond to antidumping investigations?," MPRA Paper 38790, University Library of Munich, Germany.
  11. Bown, Chad P., 2009. "The global resort to antidumping, safeguards, and other trade remedies amidst the economic crisis," Policy Research Working Paper Series 5051, The World Bank.
  12. Vandenbussche, Hylke & Zarnic, Ziga, 2007. "Did US Safeguards Affect Mark-ups of EU Steel Producers?," CEPR Discussion Papers 6486, C.E.P.R. Discussion Papers.

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