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Anti-dumping protection, price undertaking and product innovation

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  • Kao, Kuo-Feng
  • Peng, Cheng-Hau

Abstract

This paper examines how price undertaking policies affect the product investments of firms in an intra-industry trade model. We show that the dumping margin will decline if the products become more differentiated. Under bilateral anti-dumping actions, relative to those under free trade, the aggregate product R&D investment may either increase or decrease, depending on the tolerable dumping margin set by the governments. By contrast, the aggregate product R&D will definitely decline and the products will become less differentiated if only one government implements anti-dumping actions.

Suggested Citation

  • Kao, Kuo-Feng & Peng, Cheng-Hau, 2016. "Anti-dumping protection, price undertaking and product innovation," International Review of Economics & Finance, Elsevier, vol. 41(C), pages 53-64.
    • Handle: RePEc:eee:reveco:v:41:y:2016:i:c:p:53-64
    DOI: 10.1016/j.iref.2015.09.006
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    Cited by:

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    3. Chen, Yufeng & Zhang, Shun & Miao, Jiafeng, 2023. "The negative effects of the US-China trade war on innovation: Evidence from the Chinese ICT industry," Technovation, Elsevier, vol. 123(C).
    4. Hwang, Hong & Hsueh, Yi-Shan & Peng, Cheng-Hau, 2018. "Trade liberalization and product R&D in a differentiated duopoly," International Review of Economics & Finance, Elsevier, vol. 56(C), pages 34-38.
    5. Ray-Yun Chang & Hong Hwang & Cheng-Hau Peng, 2020. "Antidumping protection and welfare in a differentiated duopoly," The Japanese Economic Review, Springer, vol. 71(3), pages 421-446, July.

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    More about this item

    Keywords

    Anti-dumping policy; Price undertaking; Product R&D;
    All these keywords.

    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

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