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Free trade and deep integration : antidumping and antitrust in regional agreements

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  • Hoekman, Bernard

Abstract

Preferential trading agreements (PTAs) are increasingly including elements of"deep"integration--efforts to agree on common regulatory regimes. The author explores what the PTA experience suggests about the relationship between shallow integration--attaining unconditional intra-area free trade (including the abolition of antidumping)--and deeper integration, especially agreement about common antitrust rules. He argues that common antitrust disciplines in PTAs tend to be driven by a broader agenda--which revolves around attaining economic integration (for example, by creating a single market), not by a need to abolish antidumping. Many PTAs continue to apply antidumping to internal trade flows. In practice, it may be that the demise of antidumping in PTAs is constrained because governments are concerned about the potential for their partners to engage in beggar-thy-neighbor industrial policies. They may consider antidumping a useful defensive instrument in this connection, as it can substitute for instruments such as countervailing duties, which have a much higher foreign policy content andmay be more difficult to pursue. If so, antidumping is a particularly ineffective and costly instrument. Eliminating it in PTAs would help focus attention on the real source of trade problems (industrial policies and government interventions) rather than on the symptoms (allegations of unfair dumping).

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1950.

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Date of creation: 31 Jul 1998
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Handle: RePEc:wbk:wbrwps:1950

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Keywords: Economic Theory&Research; Rules of Origin; Labor Policies; Environmental Economics&Policies; Trade Policy; TF054105-DONOR FUNDED OPERATION ADMINISTRATION FEE INCOME AND EXPENSE ACCOUNT; Environmental Economics&Policies; Economic Theory&Research; Trade and Regional Integration; Rules of Origin;

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References

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  1. Staiger, Robert W. & Wolak, Frank A., 1992. "The effect of domestic antidumping law in the presence of foreign monopoly," Journal of International Economics, Elsevier, vol. 32(3-4), pages 265-287, May.
  2. Robert W. Staiger & Frank A. Wolak, 1989. "Strategic Use of Antidumping Law to Enforce Tacit International Collusion," NBER Working Papers 3016, National Bureau of Economic Research, Inc.
  3. Mata, José & Pita Barros, Pedro Luis, 1996. "Competition Policy in Portugal," CEPR Discussion Papers 1441, C.E.P.R. Discussion Papers.
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  5. Collie, David, 1991. "Export subsidies and countervailing tariffs," Journal of International Economics, Elsevier, vol. 31(3-4), pages 309-324, November.
  6. Michael P. Leidy, 1997. "Macroeconomic Conditions and Pressures for Protection under Antidumping and Countervailing Duty Laws: Empirical Evidence from the United States," IMF Staff Papers, Palgrave Macmillan, vol. 44(1), pages 132-144, March.
  7. Rowat, M. & Lubrano, M. & Porrata, R.Jr., 1997. "Competition Policy and MERCOSUR," Papers 385, World Bank - Technical Papers.
  8. Horn, Henrik & Levinsohn, James, 2001. "Merger Policies and Trade Liberalisation," Economic Journal, Royal Economic Society, vol. 111(470), pages 244-76, April.
  9. Vandenbussche, Hylke & Veugelers, Reinhilde, 1996. "European Anti-dumping Policy and the Profitability of National and International Collusion," CEPR Discussion Papers 1469, C.E.P.R. Discussion Papers.
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  11. Pittman, R., 1997. "Competition Law in Central Eastern Europe: Five Years Later," Papers 97-2, U.S. Department of Justice - Antitrust Division.
  12. Barros, Pedro P. & Cabral, Luis, 1994. "Merger policy in open economies," European Economic Review, Elsevier, vol. 38(5), pages 1041-1055, May.
  13. David R. Collie, 2003. "Mergers and Trade Policy under Oligopoly," Review of International Economics, Wiley Blackwell, vol. 11(1), pages 55-71, February.
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  15. Togan, Sübidey, 1997. "Opening up the Turkish Economy in the Context of the Customs Union with EU," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 12, pages 157-179.
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Cited by:
  1. Siroën, Jean-Marc, 2002. "Politique(s) de la concurrence dans une économie globale," Economics Papers from University Paris Dauphine 123456789/6628, Paris Dauphine University.
  2. Ronald Fischer & Martín Osorio, 2002. "Why Do We Need Antidumping Rules?," Documentos de Trabajo 134, Centro de Economía Aplicada, Universidad de Chile.

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