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The Global Chilling Effects of Antidumping Proliferation

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Author Info
Vandenbussche, Hylke
Zanardi, Maurizio

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Abstract

Advocates of antidumping (AD) laws downplay their effects by arguing that the trade flows that are subject to AD are small and their distortions negligible. This paper is the first to counter that notion by quantifying the worldwide effect of AD laws on aggregate trade flows. The recent proliferation of AD laws across countries provides us with a natural experiment to estimate the trade effects of adopting versus using AD laws; differences in the intensity of use among countries with older AD laws allow us to investigate reputation effects. For this purpose, we estimate worldwide trade flows using a gravity equation spanning 21 years (1980-2000) of annual observations. Our estimates confirm that AD effects are not small. Among other findings, new tough users have their aggregate imports depressed by US$15.7bn a year (or 6.7%) as a result of the AD measures they have imposed. For a traditional user like the United States, current AD measures depress annual imports by almost US$20bn on top of the cumulative negative effect of reputation. For some countries, the dampening effects of AD laws on trade flows are found to nearly offset the gains from trade liberalization.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5597.

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Date of creation: Apr 2006
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Handle: RePEc:cpr:ceprdp:5597

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Related research
Keywords: antidumping; gravity equation; trade flows; trade liberalization;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade

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  1. Michael Moore & Maurizio Zanardi, 2008. "Trade Liberalization and Antidumping: Is There a Substitution Effect?," ECARES Working Papers 2008_024, Université Libre de Bruxelles, Ecares. [Downloadable!]
  2. Moore, Michael O. & Zanardi, Maurizio, 2006. "Does antidumping use contribute to trade liberalization? : an empirical analysis," Discussion Paper 61, Tilburg University, Center for Economic Research. [Downloadable!]
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