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Antidumping and the Death of Trade

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  • Tibor Besedeš
  • Thomas J. Prusa

Abstract

We investigate the extent to which antidumping actions eliminate trade altogether. Using quarterly export data for products involved in U.S. antidumping cases we find that antidumping actions increase the hazard rate by more than fifty percent. We find strong evidence of investigation effects with the impact during the initiation and preliminary duty phases considerably larger than during the final duty phase. There are also important differences with respect to the size of duties. Cases with higher duties face a much higher hazard in the preliminary phase but there is little additional effect when the final duty is actually levied. By contrast, cases with lower duties have a smaller but more persistent effect on the hazard, which proves to be highly detrimental in the long run as many trade relationship cease during the duration of the order. Given the literature on heterogeneous firms and trade, our results imply antidumping protection imposes greater costs than previously recognized.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 19555.

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Date of creation: Oct 2013
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Handle: RePEc:nbr:nberwo:19555

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  1. Sueyoshi, Glenn T, 1995. "A Class of Binary Response Models for Grouped Duration Data," Journal of Applied Econometrics, John Wiley & Sons, Ltd., John Wiley & Sons, Ltd., vol. 10(4), pages 411-31, Oct.-Dec..
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