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Preferential trade agreements and antidumping actions against members and nonmembers

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  • Mukunoki, Hiroshi

Abstract

In a three-country oligopoly model, this paper analyzes a country's decisions concerning antidumping (AD) action against two foreign countries and the relationship between those decisions and regional trade agreements (RTAs). An RTA intensifies product-market competition in the markets of member countries and lowers product prices, while it raises export prices of goods subject to tariff reductions. This effect widens the dumping margin of the non-member firm and narrows the dumping margin of the member firm. If the government is more concerned with domestic firm profit in its AD decision, the RTA may invoke the member's AD action against the nonmember. If the governments attach a sufficiently high value on social welfare, however, the RTA may promote the AD action against the member. If the governments' weight on the domestic firm's profit is neither high nor low, an RTA may block the AD actions against both countries.

Suggested Citation

  • Mukunoki, Hiroshi, 2016. "Preferential trade agreements and antidumping actions against members and nonmembers," IDE Discussion Papers 611, Institute of Developing Economies, Japan External Trade Organization(JETRO).
  • Handle: RePEc:jet:dpaper:dpaper611
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    File URL: https://ir.ide.go.jp/?action=repository_action_common_download&item_id=37575&item_no=1&attribute_id=22&file_no=1
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    References listed on IDEAS

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    1. Anderson, Simon P. & Schmitt, Nicolas & Thisse, Jacques-Francois, 1995. "Who benefits from antidumping legislation?," Journal of International Economics, Elsevier, pages 321-337.
    2. Miyagiwa, Kaz & Ohno, Yuka, 2007. "Dumping as a signal of innovation," Journal of International Economics, Elsevier, vol. 71(1), pages 221-240, March.
    3. José L. Moraga‐González & Jean‐Marie Viaene, 2015. "Antidumping, Intra‐Industry Trade, And Quality Reversals," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 56, pages 777-803, August.
    4. Reitzes, James D, 1993. "Antidumping Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 34(4), pages 745-763, November.
    5. Antoni Estevadeordal & Caroline Freund & Emanuel Ornelas, 2008. "Does Regionalism Affect Trade Liberalization Toward Nonmembers?," The Quarterly Journal of Economics, Oxford University Press, vol. 123(4), pages 1531-1575.
    6. Emanuel Ornelas, 2005. "Rent Destruction and the Political Viability of Free Trade Agreements," The Quarterly Journal of Economics, Oxford University Press, vol. 120(4), pages 1475-1506.
    7. Ornelas, Emanuel, 2005. "Endogenous free trade agreements and the multilateral trading system," Journal of International Economics, Elsevier, vol. 67(2), pages 471-497, December.
    8. Xiwang Gao & Kaz Miyagiwa, 2005. "Antidumping protection and R&D competition," Canadian Journal of Economics, Canadian Economics Association, vol. 38(1), pages 211-227, February.
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    Cited by:

    1. MUKUNOKI Hiroshi, 2017. "Does Trade Liberalization Promote Antidumping Protection? A theoretical analysis," Discussion papers 17031, Research Institute of Economy, Trade and Industry (RIETI).

    More about this item

    Keywords

    International trade; International agreements; Preferential trade liberalization; Antidumping; International oligopoly;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets

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