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Dumping in Developing and Transition Economies

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  • José Luis Moraga-González
  • Jean-Marie Viaene

Abstract

We build a simple theoretical model to understand why developing and transition economies have increasingly applied anti-dumping laws. To that end, we investigate the strategic incentives of oligopolistic exporting firms to undertake dumping in these economies. We show that dumping may be due to cross-country differences in income, to the extent of tariff protection and to the exchange rate depreciations observed recently. Dumping may arise even if consumers exhaust all arbitrage possibilities.

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Bibliographic Info

Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 1356.

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Date of creation: 2004
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Handle: RePEc:ces:ceswps:_1356

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Keywords: dumping; exchange rate; optimal trade policy; product quality;

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  1. Motta, M. & Thisse, J.-F. & Cabrales, A., . "On the persistence of leadership or leapfrogging in international trade," CORE Discussion Papers RP -1287, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  2. Brander, James & Krugman, Paul, 1983. "A 'reciprocal dumping' model of international trade," Journal of International Economics, Elsevier, vol. 15(3-4), pages 313-321, November.
  3. Lankhuizen ,Maureen, 1997. "Shifts in foreign trade, competitiveness and growth potential : from Baltics to "Bal-techs" ?," Research Memorandum 009, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
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  7. Feinberg, Robert M, 1989. "Exchange Rates and "Unfair Trade."," The Review of Economics and Statistics, MIT Press, vol. 71(4), pages 704-07, November.
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  9. Jose Luis Moraga-Gonzalez & Jean-Marie Viaene, 2004. "Anti-dumping, Intra-industry Trade and Quality Reversals," Tinbergen Institute Discussion Papers 04-124/2, Tinbergen Institute.
  10. Curtis Eaton, B. & Schmitt, N., 1991. "Flexible Manufacturing and Market Structure," Papers 1991-02, Tasmania - Department of Economics.
  11. Cabrales, Antonio & Motta, Massimo, 2001. "Country asymmetries, endogenous product choice and the timing of trade liberalization," European Economic Review, Elsevier, vol. 45(1), pages 87-107, January.
  12. Weinstein, David E., 1992. "Competition and unilateral dumping," Journal of International Economics, Elsevier, vol. 32(3-4), pages 379-388, May.
  13. John C. Harsanyi & Reinhard Selten, 1988. "A General Theory of Equilibrium Selection in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262582384, December.
  14. Choi, E. Kwan & Harrigan, James, 2003. "Handbook of International Trade," Staff General Research Papers 11375, Iowa State University, Department of Economics.
  15. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, December.
  16. Bruce A. Blonigen & Thomas J. Prusa, 2001. "Antidumping," NBER Working Papers 8398, National Bureau of Economic Research, Inc.
  17. David Greenaway & Robert Hine & Chris Milner, 1994. "Country-specific factors and the pattern of horizontal and vertical intra-industry trade in the UK," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 130(1), pages 77-100, March.
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Cited by:
  1. Jose Luis Moraga-Gonzalez & Jean-Marie Viaene, 2004. "Dumping in a Global World," Tinbergen Institute Discussion Papers 04-128/2, Tinbergen Institute.

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