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Trade Liberalization and Antidumping: Is There a Substitution Effect?

Author

Listed:
  • Michael Owen Moore

    (Department of Economics/Institute for International Economic Policy, George Washington University)

  • Maurizio Zanardi

    (European Center for Advanced Research in Economics and Statistics (ECARES), Universit Libre de Bruxelles)

Abstract

Many nations have undergone significant trade liberalization in the last twenty years even as they have increased their use of contingent protection measures. This raises the question of whether some of the trade liberalization efforts, at times accomplished through painful reforms, have been undone through a substitution from tariffs to non- tariff barriers. Among the new forms of protection, antidumping is the most relevant, as its use has spread from few developed countries to a large set of developing countries that are now among the most intense users of this instrument. This paper uses a newly developed database to examine to what extent the use of antidumping in a large set of countries is systematically influenced by the reduction of applied sectoral tariffs. The data set includes information on 29 developing and 7 developed countries from 1991 through 2002. After controlling for time-varying sectoral information as well as macroeconomic conditions, we find evidence of a substitution effect only for heavy users of antidumping among developing countries. In particular, a one standard deviation increase in sectoral trade liberalization increases the probability of observing an antidumping initiation by 32 percent. There is no similar statistically significant result for other developing countries or developed countries. We also find robust evidence of retaliation and deflection effects as determinant of antidumping filings across all subsamples.

Suggested Citation

  • Michael Owen Moore & Maurizio Zanardi, 2008. "Trade Liberalization and Antidumping: Is There a Substitution Effect?," Working Papers 2008-09, The George Washington University, Institute for International Economic Policy.
  • Handle: RePEc:gwi:wpaper:2008-09
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    References listed on IDEAS

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    More about this item

    Keywords

    Trade Liberalization; Antidumping;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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