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Are antidumping duties for sale? case-level evidence on the Grossman-Helpman protection for sale model

Author

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  • Carolyn L. Evans
  • Shane M. Sherlund

Abstract

As successive rounds of global trade liberalization have lowered broad industry-level tariffs, antidumping duties have emerged as a WTO-consistent means of protecting certain industries. Using the Grossman-Helpman (GH) "Protection for Sale" model, we examine the extent to which political contributions affect the outcomes of decisions in antidumping cases. We find that antidumping duty rates tend to be higher for politically-active petitioners. The relationship between the import penetration ratio and duties imposed depends on whether or not petitioners in a case are politically active. Consistent with the predictions of the GH model, antidumping duties are positively correlated with the import penetration ratio for politically inactive petitioners, but negatively correlated for politically active petitioners. Thus, our paper supports the predictions of the Grossman-Helpman model using a fresh set of data that allows us to avoid some of the compromises made in previous empirical work.

Suggested Citation

  • Carolyn L. Evans & Shane M. Sherlund, 2006. "Are antidumping duties for sale? case-level evidence on the Grossman-Helpman protection for sale model," International Finance Discussion Papers 888, Board of Governors of the Federal Reserve System (U.S.).
  • Handle: RePEc:fip:fedgif:888
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    References listed on IDEAS

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    Cited by:

    1. Rajwani, Tazeeb & Liedong, Tahiru Azaaviele, 2015. "Political activity and firm performance within nonmarket research: A review and international comparative assessment," Journal of World Business, Elsevier, vol. 50(2), pages 273-283.
    2. Moonsung Kang & Hongshik Lee & Soonchan Park, 2012. "Industry-specific effects of antidumping activities: evidence from the US, the European Union and China," Applied Economics, Taylor & Francis Journals, vol. 44(8), pages 999-1008, March.

    More about this item

    Keywords

    Antidumping duties ; International trade;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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