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Anti-dumping Laws and Oligopolistic Trade

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Author Info

  • Gaudet, Gérard

    ()
    (Université de Montréal)

  • Bian, Jiang

    (University of Singapore)

Abstract

We study the effect of anti-dumping laws in a differentiated products quanti - ty-setting oligopoly. Dumping may or may not occur in the model and may or may not be reciprocal. We show that the effect of adopting an anti-dumping policy on the welfare of the importing country is ambiguous. It can even lead to an increase in the consumers’ surplus in the importing country. Hence the importing country may in some cases find strong reasons for the adoption of an anti-dumping policy. We then study the endogenous determination of the equi - librium anti-dumping policies in a two-stage game with reciprocal dumping in which the two governments simultaneously choose anti-dumping policies in a first stage. We provide a suf ficient condition, relating the degree of substi - tutability in demand between the two goods and transport cost, in order for each country to have an incentive to deviate unilaterally from free trade in the presence of anti-dumping laws. We show that governments acting cooperatively to maximize world welfare should choose to endorse the institution of antidumping laws.

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Bibliographic Info

Article provided by Center for Economic Integration, Sejong University in its journal Journal of Economic Integration.

Volume (Year): 12 (1997)
Issue (Month): ()
Pages: 62-86

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Handle: RePEc:ris:integr:0039

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Web page: http://econo.sejong.ac.kr/
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Keywords: Anti-dumping; Laws;

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Cited by:
  1. Nelson, Douglas, 2006. "The political economy of antidumping: A survey," European Journal of Political Economy, Elsevier, vol. 22(3), pages 554-590, September.
  2. Kaz Miyagiwa & Huasheng Song & Hylke Vandenbussche, 2010. "Innovation, Antidumping, and Retaliation," Emory Economics 1009, Department of Economics, Emory University (Atlanta).
  3. Anderson, S. & Schmitt, N. & Thisse, J.F., 1992. "Who Benifits from Antidumping Legislation?," Discussion Papers dp92-12, Department of Economics, Simon Fraser University.
  4. Miyagiwa, Kaz & Ohno, Yuka, 2007. "Dumping as a signal of innovation," Journal of International Economics, Elsevier, vol. 71(1), pages 221-240, March.

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