This paper provides a thorough description of anti-dumping activities in the period 1980–2015, with a focus on measures imposed by the European Union and the United States. We document a series of stylized facts, such as the emergence of China as a major target of administered protection, the concentration of duties in few sectors, and the increasing share of intermediate goods subject to anti-dumping measures. Product-level information on Chinese exporting firms shows that anti-dumping does indeed reduce exports and it has an impact on both the extensive and the intensive margin of trade. Moreover, the price of targeted products tends to rise marginally, so that the fall in export quantities is particularly strong.
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The term “dumping” denotes a situation whereby a firm either charges a lower price in a foreign market than it does domestically, or it exports the good at a price below its production costs. For details on AD duties in the context of WTO rules, please refer to Article VI of the GATT 1994 AD Agreement.
Throughout the paper we define the EU as being made up of 28 member countries: Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the United Kingdom.
Rather than focusing on the intensive margin effect of AD measures, Chandra and Long (2013) provide empirical evidence that US-imposed AD duties lead to a significant drop in both labor productivity and total factor productivity of Chinese firms. Similar issue are studied by Jabbour et al. (2019) in relation to measures imposed by the EU. They find that the productivity of surviving Chinese exporters improves after the imposition of AD measures. Other empirical studies, such as Lu et al. (2018) and Chandra (2019), have shown that the imposition of tariffs leads targeted exporters to adjust their product scope not only vis-à-vis the policy-imposing country and but also relative to third markets. Equally important is the firms’ decision to enter into and exit from export markets in response to AD shocks. This dimension has been investigated by Crowley et al. (2018), who find that Chinese firms are less likely to enter new foreign markets and more likely to exit from established foreign markets when their products are subject to AD measures.
The term case refers to a specific country and industry involved in an AD proceeding (e.g. solar glass investigation from the EU against China, or silico-manganese against India). AD cases vary substantially in their coverage, with some of them affecting several products and billions of dollars in trade value, while others target a single tariff line.
Figure A1 in the Online Appendix reports the flowchart of a typical AD investigation in the EU.
AD cases that have missing HS codes are excluded from the analysis.
The association between HS chapters and industries is reported in Table A1 in the Online Appendix.
To classify the type of products we use the Broad Economic Categories (BEC) classification.
These are Argentina, Australia, Brazil, Canada, Colombia, the EU, India, Indonesia, Israel, Japan, Jamaica, Malaysia, Mexico, New Zealand, Pakistan, Peru, Philippines, Russia, South Africa, South Korea, Taiwan, Thailand, Trinidad and Tobago, Turkey, Ukraine, Uruguay, the US and Venezuela. Among these, the top 3 users are the US, the EU and India. The top 10 countries (identified in italics) account for almost 80% of all AD cases against China between 1998 and 2015.
In Sect. 2.3 we have observed that in the US and the EU usage of AD measures varies a great deal across different sectors. This concentration remains even when we take the perspective of Chinese exporters: although all products face some degree of AD protection by at least one country, trade-weighted measures show that only a few sectors experience a substantial amount of AD barriers.
Table A2 in the Online Appendix provides additional information on the Customs data, reporting the number of firms, number of 6-digit HS codes, and total trade values for each year; moreover, it compares the information with that available in the UN Comtrade data.
We drop all observations with no information on destinations, and those reporting export to the People’s Republic of China.
More precisely, to identify intermediaries we follow Ahn et al. (2011) and Fan et al. (2015) and look for the elements such as “trading”, “exporting” and “importing” in company names. In addition, we drop observations featuring different units of measurements over time across the same firm-product-destination, we convert all quantity units to a single unit for the same product (e.g, kilograms, pairs, ...) and drop observations for which this is not possible.
We thank an anonymous referee for suggesting this approach.
In a robustness check, not shown, we split the group of AD-imposing countries in two groups, high-income and emerging economies. Results are similar to those presented in Table 2, with no differential effect between the two groups. We thank an anonymous referee for the suggestion.
For instance, shipments of “warm-water shrimp” (HS 030613) from China were subject to AD measures in the US in 2004, but faced no restrictions in the EU.
Another potential source of concern is the exclusion of zeros, that is, product-destination-year triplets for which no export flow is recorded and thus do not appear in the sample. The sheer size of the dataset makes it impossible for us to thoroughly investigate the sensitivity of the results to the inclusion of these zero flows in the analysis. Tentative evidence, based on data for 2013–2015 only, show that our main results are not dramatically affected (these results are available from the authors upon request). We thank an anonymous referee for raising the issue.
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This research paper is part of a project that has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Skłodowska-Curie grant agreement No. 794473, protection and exports (PROTEXPO)
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Schiavo, S., Tomasi, C. & Zhu, M. Anti-dumping activities against China: patterns and effects. Econ Polit (2020). https://doi.org/10.1007/s40888-020-00186-5
- Anti-dumping duties
- Trade protection
- Discriminatory tariffs