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Antidumping Protection and Productivity Growth of Domestic Firms

Author

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  • Vandenbussche, Hylke
  • Konings, Jozef

Abstract

In this Paper we provide empirical evidence that Antidumping (AD) Protection can induce technological catching-up by domestic firms affected by the import protection. We identify a panel of 1,793 import-competing domestic firms between 1993 and 2000, directly affected by AD cases that were initiated in 1996. Using a difference-in-difference approach, we find evidence of increased Total Factor Productivity (TFP) growth for firms protected by AD measures compared to firms that did not receive protection. Our analysis indicates, however, that the effect of protection depends on the ?distance to the frontier firm? in the industry. While protection raises TFP growth of ?laggard? firms, the reverse holds for domestic firms that are close to the efficiency frontier. These results confirm recent theoretical work supporting the view that protection can induce technological catching-up.

Suggested Citation

  • Vandenbussche, Hylke & Konings, Jozef, 2004. "Antidumping Protection and Productivity Growth of Domestic Firms," CEPR Discussion Papers 4620, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:4620
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    Citations

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    Cited by:

    1. Yevgeniya Shevtsova, 2012. "International Trade and Productivity: Does Destination Matter?," Discussion Papers 12/18, Department of Economics, University of York.
    2. Ngo Van Long & Horst Raff & Frank Staehler, 2007. "The Effects of Trade Liberalization on Productivity and Welfare: The Role of Firm Heterogeneity, R&D and Market Structure," Working Papers 0710, University of Otago, Department of Economics, revised Jun 2007.
    3. Jan Van Hove, 2010. "Variety and quality in intra‐European manufacturing trade: the impact of innovation and technological spillovers," Journal of Economic Policy Reform, Taylor and Francis Journals, vol. 13(1), pages 43-59.
    4. Miyagiwa, Kaz & Ohno, Yuka, 2007. "Dumping as a signal of innovation," Journal of International Economics, Elsevier, vol. 71(1), pages 221-240, March.
    5. Ralitza Dimova, 2008. "The impact of labour reallocation and competitive pressure on TFP growth: firm-level evidence from crisis and transition ridden Bulgaria," International Review of Applied Economics, Taylor & Francis Journals, vol. 22(3), pages 321-338.
    6. S. K.S. YADAV, & Muhammad Ali Nawazeesh, Author- Workplace-Name: American International University, Bangladesh & Alexandru Mircea NEDELEA Author- Workplace-Name: Stefan cel Mare University of Suceava,, 2016. "Formal Trade Between India And Bangladesh: An Empirical Analysis," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 5(2), pages 1-3, July.
    7. Meredith A. Crowley, 2006. "Why are safeguards needed in a trade agreement?," Working Paper Series WP-06-06, Federal Reserve Bank of Chicago.

    More about this item

    Keywords

    C20; Total factor productivity; Antidumping protection; Technological catching-up;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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