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Antidumping and Feed-In Tariffs as Good Buddies? Modeling the EU-China Solar Panel Dispute

Author

Listed:
  • Patrice Bougette

    (Université Côte d'Azur
    GREDEG CNRS)

  • Christophe Charlier

    (Université Côte d'Azur
    GREDEG CNRS)

Abstract

The paper analyzes the interactions between trade and renewable energy policies based on the EU--China Solar Panel dispute which is the most significant antidumping (AD) complaint in Europe. We build a price competition duopoly model with differentiated products and intra-industry trade in photovoltaic equipment. We provide two relevant types of AD duties. The optimal AD which maximizes social domestic welfare always increases with the feed-in tariff (FIT) program set in the home country. The appropriate AD -- equalizing the foreign firm's price on the domestic market with the foreign market price -- decreases with the FIT program. We show that the optimal FIT increases with the AD duty. Therefore, trade and renewable energy optimal policies may complement one another. When setting AD duties in clean energy sectors, it is important not to ignore the extent to which renewable energy is subsidized.

Suggested Citation

  • Patrice Bougette & Christophe Charlier, 2017. "Antidumping and Feed-In Tariffs as Good Buddies? Modeling the EU-China Solar Panel Dispute," GREDEG Working Papers 2017-17, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis.
  • Handle: RePEc:gre:wpaper:2017-17
    as

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    File URL: http://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2017-17.pdf
    File Function: First version, 2017
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Antidumping; FIT; Solar Panels; Renewable Energy; Trade disputes; EU; China;

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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