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Antidumping protection and welfare in a differentiated duopoly

Author

Listed:
  • Ray-Yun Chang

    (Chinese Culture University
    National Taiwan University)

  • Hong Hwang

    (National Taiwan University
    Academia Sinica)

  • Cheng-Hau Peng

    (Fu Jen Catholic University)

Abstract

This paper employs a two-country Cournot model to investigate the protection and welfare effects of an antidumping (AD) duty and a price-undertaking policy under different dumping measures (i.e., injury margin and dumping margin) in a differentiated duopoly. We show that the welfare levels of the host country and the world as a whole are lower under a price-undertaking policy than an AD-duty policy. However, the former is superior to the AD-duty policy in terms of protection. These results are robust even if the firms engage in Bertrand competition.

Suggested Citation

  • 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.
    • Handle: RePEc:spr:jecrev:v:71:y:2020:i:3:d:10.1007_s42973-019-00024-9
    DOI: 10.1007/s42973-019-00024-9
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    References listed on IDEAS

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    Cited by:

    1. Cheng‐Hau Peng & Hong Hwang & Kuo‐Feng Kao, 2023. "Is price undertaking a more friendly protection policy than an anti‐dumping duty?," The World Economy, Wiley Blackwell, vol. 46(1), pages 120-134, January.

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