Why does the WTO have an Antidumping Agreement?
AbstractThis 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 InfoPaper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 25310.
Date of creation: 2010
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Antidumping; non-cooperative games; WTO; proliferation;
Find related papers by JEL classification:
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
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