On the Spread and Impact of Antidumping

This paper documents two key costs of AD protection. First, once AD has been adopted countries often have a difficult time restraining its use. In recent years 'new' users have accounted for half of the overall world total. Many of the heaviest AD users are countries who did not even have an AD statute a decade ago. Second, I will show that on average AD duties cause the value of imports to fall by 30-50%. I find that trade falls by almost as much for settled cases as those that result in duties. Interestingly, I also find that even for those cases that are rejected imports fall. The spread and impact of AD protection most surely implies that AD will continue to be a key negotiating item in the next WTO round.

The Role of Extensive and Intensive Margins and Export Growth

We investigate and compare countries' export growth based on their performance at the extensive and intensive export margins. Our empirical approach is motivated by an extension to the Melitz (2003) model of heterogeneous firms in which exporters are subject to a one-time sunk cost and also a per-period fixed cost. With imperfect information a firm may enter export markets but shortly exit when it learns its per- period fixed costs. We apply this insight to disaggregated export data and confirm that indeed most export relationships are very short lived. We then show that the survival issue is a significant factor in explaining differences in long run export performance. We find that developing countries would experience significantly higher export growth if they were able to improve their performance with respect to the two key components of the intensive margin: survival and deepening.

The Reasons for and the Impact of Antidumping Protection: The Case of People's Republic of China

Over the past few decades, the liberalization in international trade has progressed at a rapid speed. While tariffs and quotas have been and continue to be reduced, another type of trade barrier, antidumping, is being used more and more frequently as a measure of protection. This paper focuses on the case of China, explores the characteristics, the reasons for and implications of antidumping. China is the largest targeting economy of antidumping (AD) trade disputes and there is evidence that China is more susceptible to antidumping than other economies, even after controlling for factors such as the non-market economy (NME) status. Our paper analyzes the reasons for China being so broadly and intensively targeted. In particular, the domestic characteristics of exports structure and industrial structures are examined. Our analysis also reveals that foreign direct investment (FDI) may be a significant factor explaining AD cases against China. There is also evidence that low concentration ratios in Chinese industries have contributed to the competitive price and low profit margins. An earlier draft of this paper was presented at the APEC Capacity-Building Workshop on Quantification of NTMs and Trade Facilitation, October 8-10, 2003, in Bangkok, Thailand.

The Economic and Strategic Motives for Antidumping Filings

This paper takes a critical look at the trends in worldwide antidumping (AD) case filings during the last two decades. We examine the motives for AD filings by countries in an attempt to identify whether economic or strategic concerns are driving the recent upsurge in AD use. We begin by providing a comprehensive overview of the data on cases initiated in the 1980 to 1998 period. We then use non-parametric methods to identify national motivations for the use of antidumping. Results show considerable support for the importance of strategic concerns in driving AD case filings. This suggests that the rise in AD activity cannot be solely explained by an increase in unfair trading practices.

Surviving the U.S. Import Market: The Role of Product Differentiation

We examine the extent that product differentiation affects the duration of US import trade relationships. Applying nonparametric and semiparametric techniques to highly disaggregated product-level data we estimate that the hazard rate is at least 18 percent higher for homogenous goods than for differentiated products. Put another way, the median survival time for trade relationships involving differentiated products is five years as compared to two years for homogenous products. We find that our results are not only highly robust but often are strengthened under alternative specifications. For instance, if we define trade relationships using industry-level rather than product-level data we find that the hazard rate is 30-35 percent higher for homogenous goods than for differentiated products. We also find that the survival ranking across product types holds across individual industries. We show that dropping the smallest trade relationships further accentuates the differences among product types. We also control for the possible measurement error in measuring spell lengths and the role of multiple spell relationships and find that in all cases the differences among products types are greater than in our benchmark analysis.

On the Duration of Trade

This paper employs survival analysis to study the duration of US imports. We find that the median duration of exporting a product to the US is very short, on the order to two to four years. Our results also indicate that there is negative duration dependence meaning that if a country is able to survive in the exporting market for the first few years it will face a very small probability of failure and will export the product for a long period of time. This result holds across countries and industries. We find that our results are not only robust to aggregation but are strengthened by aggregation. That is, as we aggregate from product level trade data to SITC industry level trade data the estimated survival increases. We rank countries by their survival experience and show that our rankings are strongly correlated with the rankings in Feenstra and Rose (2002), implying that product cycle followers also experience particularly short duration.