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Why does the WTO have an Antidumping Agreement?

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  • James C. Hartigan
  • Hylke Vandenbussche

Abstract

This paper develops a model that offers a plausible interpretation for the empirical observation of diffusion of antidumping (AD) laws amongst WTO members. Contrary to the regnant belief that this proliferation is driven mainly by retaliatory motives, our model shows that adoption and use of AD laws involve a cooperative act amongst WTO members in an infinite horizon game. The diffusion of AD laws need not result in a Prisonner.s dilemma. Instead we show that the AD agreement of the WTO can serve as a risk-sharing vehicle amongst WTO members in response to adverse shocks incurred by domestic producers.

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Bibliographic Info

Paper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 25310.

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Date of creation: 2010
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Handle: RePEc:lic:licosd:25310

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Keywords: Antidumping; non-cooperative games; WTO; proliferation;

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References

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  1. Mansfield, Edward D. & Milner, Helen V. & Rosendorff, B. Peter, 2002. "Why Democracies Cooperate More: Electoral Control and International Trade Agreements," International Organization, Cambridge University Press, vol. 56(03), pages 477-513, June.
  2. James Brander & Paul Krugman, 1982. "A 'Reciprocal Dumping' Model of International Trade," Working Papers 513, Queen's University, Department of Economics.
  3. Konings, Jozef & Vandenbussche, Hylke, 2008. "Heterogeneous Responses of Firms to Trade Protection," CEPR Discussion Papers 6724, C.E.P.R. Discussion Papers.
  4. Kyle Bagwell & Robert W. Staiger, 1988. "A Theory of Managed Trade," NBER Working Papers 2756, National Bureau of Economic Research, Inc.
  5. Murray, Tracy & Turdaliev, Nurlan, 1999. "Universal Dumping of Homogeneous Products," Review of International Economics, Wiley Blackwell, vol. 7(4), pages 580-89, November.
  6. 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.
  7. Michael O. Moore, 2006. "An Econometric Analysis of U.S. Antidumping Sunset Review Decisions," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 142(1), pages 122-150, April.
  8. Hartigan, James C, 2002. "Endogenous Obfuscation in Injury Investigations," Economica, London School of Economics and Political Science, vol. 69(275), pages 505-23, August.
  9. Wilfred J. Ethier, 2001. "Unilateralism in a Multilateral World," Tinbergen Institute Discussion Papers 01-033/2, Tinbergen Institute.
  10. MARTIN, Alberto & VERGOTE, Wouter, . "On the role of retaliation in trade agreements," CORE Discussion Papers RP -2037, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  11. Benjamin Liebman, 2004. "ITC voting behavior on sunset reviews," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 140(3), pages 446-475, September.
  12. Robert M. Feinberg & Kara M. Olson, 2004. "The Spread of Antidumping Regimes and the Role of Retaliation in Filings," International Trade 0411003, EconWPA.
  13. Vandenbussche, Hylke & Veugelers, Reinhilde & Konings, Jozef, 2001. "Unionization and European Antidumping Protection," Oxford Economic Papers, Oxford University Press, vol. 53(2), pages 297-317, April.
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Cited by:
  1. Hylke VANDENBUSSCHE & Christian VIEGELAHN, 2011. "No Protectionist Surprises: EU Antidumping Policy Before and During the Great Recession," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2011021, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).

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