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Why Do Firms Pay Antidumping Duty?

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Author Info

  • Poonam Gupta

Abstract

With the virtual elimination of tariffs and quotas under GATT, antidumping measures emerged as a key instrument of protection. Under antidumping actions exporters can either raise the price to eliminate the dumping margin or pay an antidumping duty. This paper analyzes the incentives to exporters to choose between duty or settlement outcomes and finds that due to the smaller loss in market share exporters may prefer an antidumping duty over voluntary settlement. The paper analyzes the welfare implications of these outcomes and finds that they are ambiguous.

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Bibliographic Info

Paper provided by International Monetary Fund in its series IMF Working Papers with number 99/166.

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Length: 24
Date of creation: 01 Dec 1999
Date of revision:
Handle: RePEc:imf:imfwpa:99/166

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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. Falvey, Rod & Wittayarungruangsri, Sarut, 2006. "Market size and antidumping in duopolistic competition," European Journal of Political Economy, Elsevier, vol. 22(3), pages 771-786, September.

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