The Trade Effects of Anti-Dumping Duties: Firm-level Evidence from China

24  April 2017    3:00 pm

Alexander-Nikolai Sandkamp, ifo Zentrum für Außenwirtschaft, Munich

In cooperation with:
Research Centre International Economics (FIW) 


wiiw, Rahlgasse 3, 1060 Vienna


Alexander-Nikolai Sandkamp

Trade protection is on the rise again and anti-dumping (AD) duties remain a common instrument in this respect, especially against China. This paper uses Chinese customs data to investigate the effects of AD duties on Chinese exporters, exploiting firm level data to address endogeneity concerns linked to trade protection. We find that the effects of AD duties differ strongly across destination markets and industries. Our empirical results show that the European and US markets react very differently to the imposition of duties, so that existing findings based on US data cannot easily be generalised to other countries. We find evidence that AD duties tend to drive some exporters out, while the remaining ones grow larger, implying that AD instruments may not be capable of protecting domestic industries in the long run. Finally, we find that AD duties lead to market entry of Chinese exporters into third countries as well as to increased exports to these countries by established exporters.

Keywords: Anti-dumping, China, Trade, Firm Heterogeneity

JEL classification: F12, F13, F14, D22