Working Paper: CEPR ID: DP7916
Authors: Kaz Miyagiwa; Huasheng Song; Hylke Vandenbussche
Abstract: We develop a North-South model of reciprocal antidumping (AD). We find that AD wars are winnable for the Northern firm if the Southern market is sufficiently small relative to the North?s. The South can avert AD war with the North by expanding the home market size. It may however trigger AD war by improving its R&D capability. The model yields results that are largely consistent with recent empirical findings that (1) AD is concentrated in R&Dintensive industries, (2) AD actions are mostly between industrial and developing countries, and (3) developing countries use AD to retaliate against industrial countries.
Keywords: antidumping; intellectual property rights; R&D; reciprocal dumping
JEL Codes: F12; F13; L13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Market size difference (L25) | Likelihood of initiating AD actions (C69) |
| Southern market size (R12) | Prevention of AD wars (D74) |
| R&D capabilities (O32) | Triggering of AD wars (D74) |
| Reciprocal AD (C22) | Southern firms' R&D investment (D25) |
| Reciprocal AD (C22) | Northern firms' R&D investment (F23) |
| Southern market size (R12) | Reciprocal AD effects on investment decisions (G11) |