The 'Market' for contingent protection

Authors: DONALD FEAVER; KENNETH WILSON

Source: International Review of Applied Economics, Volume 18, Number 4, October 2004 , pp. 497-509(13)

Publisher: Routledge, part of the Taylor & Francis Group

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Abstract:

Anti-dumping and countervailing duty law and policy has, for several decades, been one of the most contentious issues affecting trading relations between members of the World Trade Organization. A major concern among researchers and policy-makers is that the decision-making process of regulatory authorities responsible for the administration of anti-dumping and countervailing duty (AD/CVD) laws is biased in favour of providing protectionist outcomes for national applicant firms and industries. In this paper a new, broader approach for testing empirically AD/CVD outcome decisions is advocated that analyses the provision of contingent protection as the outcome of a quasi-market process involving supply and demand behaviour played out in a quasi-market context susceptible to market failure. This approach provides, arguably, a fairer test of AD/CVD outcomes. Using data from Australia, historically a heavy user of AD/CVD laws and policy, the paper finds support for the hypothesis that regulatory process bias including administrative and statutory biases, are important explanators of AD/CVD outcomes. Moreover the findings of this paper suggest that failure to include variables capturing these effects in other studies that have modelled empirically AD/CVD outcomes may have led to missing variable bias and false conclusions.

Keywords: Dumping; anti-dumping; contingent protection

Document Type: Research article

DOI: http://dx.doi.org/10.1080/0269217042000266409

Affiliations: 1: School of International Business Queensland University of Technology Australia

Publication date: 2004-10-01

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