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Dumping in a Global World

Author

Listed:
  • Jose Luis Moraga-Gonzalez

    (Groningen University)

  • Jean-Marie Viaene

    (Faculty of Economics, Erasmus Universiteit Rotterdam)

Abstract

Anti-dumping actions are now the trade policy of choice of developing and transition economies. To understand why these economies have increasingly applied anti-dumping laws, we build a simple theoretical model of vertical intra-industry trade and investigate the strategic incentives of exporting firms to undertake dumping. We show that the definition of dumping matters. Based on a comparison of low-quality and high-quality prices, only unilateral dumping by the low-quality firm obtains. By contrast, the standard WTO definition leads to either reciprocal or unilateral dumping by the high-quality firm, depending on cross-country differences in incomes, the height of tariff protection and on exchange rate changes. See publication in The World Economy , 2005, 28(5), 669-682.

Suggested Citation

  • Jose Luis Moraga-Gonzalez & Jean-Marie Viaene, 2004. "Dumping in a Global World," Tinbergen Institute Discussion Papers 04-128/2, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20040128
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    References listed on IDEAS

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    More about this item

    Keywords

    Dumping; Exchange Rate; Injury; Product Quality; Tariffs;
    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
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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