U.S. Antidumping Filings and the Threat of Retaliation

Abstract

This paper is a first attempt to examine the effect of retaliation threats on the likelihood of antidumping petitions. A model of reciprocal dumping with antidumping law in a repeated context predicts that firms will be less likely to file for antidumping protection as the expected profit loss from retaliation becomes high enough. We use a panel data set of U.S. antidumping petitions across 4-digit SIC manufacturing industries from 1980 through 1992 to examine this hypothesis. We separate import sources into those with antidumping regimes and those without, which allows us to identify in our data where the threat of retaliation is more likely. In general, the impact of retaliation threat varies across import sources. We find retaliation exposure significantly lowers the likelihood of U.S. petitions against products from Australia and New Zealand, but find no such effects for products from Canada or the European Community. JEL Codes: F13, L13.

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