Progress 09/01/05 to 08/31/08
Outputs
OUTPUTS: This project resulted in the creation of two new sources of information for researchers, government officials, and policy analysts interested in antidumping regulations. The first is a set of 22 case studies of all antidumping investigations involving the U.S. agricultural sector between 1995 and 2003. The second is a compendium of antidumping regulations in twelve of the leading users of antidumping protection in the world. Both databases are available at the website created for the dissemination of this information at http://nw08.american.edu/~reynolds/antidumping.html. This project also helped to refine a third database including information on the antidumping investigations initiated by 18 countries known as the Global Antidumping Database. This dataset is available at the website http://people.brandeis.edu/~cbown/global_ad/. In addition to the annual NRI project director's meetings, I presented the findings of this research at the College of William and Mary in October 2006, the Southern Economic Association Meetings in November 2006, the World Bank's Antidumping and Developing Countries Conference in December 2006, and George Washington University in February 2007. PARTICIPANTS: This project provided funding to two graduate students from American University's Ph.D. in Economics Program. Yan Su received a one-year fellowship and continued to work on a part-time basis for two subsequent years on the project. Her primary responsibilities were to prepare rough drafts of approximately five case studies on the use of antidumping in the U.S. agriculture sector, as well as the antidumping regulations in four of the leading users of antidumping protection. Yan Su also collected data on methods countries use to calculate the level of antidumping duties and attended the 2007 NRI Project Director's meeting on my behalf. The second student, Zeynep Elif Aksoy, worked on an hourly basis on the project collecting data on the methods countries use to calculate the level of antidumping duties and preparing drafts on the antidumping regulations in three of the leading users of this form of protection. TARGET AUDIENCES: This project serves three target audiences. First, this project has served researchers of antidumping protection by developing and improving new sources of data on the worldwide use of antidumping. Second, the database on the antidumping regulations in ten of the leading users of this form of protection, as well as the non-technical case summaries and case summary analysis, should help U.S. agricultural producers defend themselves from unfair antidumping protection in foreign countries. U.S. agricultural producers could use the same information to prepare their own requests for protection from surges in foreign imports through U.S. antidumping law. Finally, the results of this project should be of great interest to U.S. policy makers, who should consider negotiating changes in the World Trade Organization's Antidumping Agreement if they value homogeneity in the application of antidumping duties across countries and industries. PROJECT MODIFICATIONS: Nothing significant to report during this reporting period.
Impacts
Agriculture analysts have hypothesized that antidumping regulations are biased toward imposing more protection on agricultural goods than others due to unique characteristics in the industry such as the perishable-nature of the product. Using a variety of econometric and statistical techniques, this project found little statistical evidence that antidumping duty determinations are higher in the agricultural sector when compared to other industries. However, the project did find some evidence that antidumping investigations involving agricultural products more often result in the imposition of duties than those involving other products. Further empirical testing revealed that countries do not necessarily treat the agriculture sector differently during antidumping investigations. Instead, the probability of the imposition of antidumping protection is higher in the agriculture sector because the characteristics of the industries filing antidumping petitions in the manufactured sector are vastly different from the characteristics of industries filing antidumping petitions in the agricultural sector. For example, the industry's share of GDP and employment, and the exporter's share of industry imports, are noticeably higher in cases involving the agriculture sector than other cases. Similarly, the average industry's production growth is noticeably lower in cases involving the agriculture sector than in the manufacturing sector. These differences in the explanatory variables can have a dramatically different impact on the predicted outcomes of antidumping investigations. Data analysis further suggests that differences in country-specific antidumping regulations may cause the level of agricultural bias discussed above to be higher in some countries when compared to others. The bias appears to be particularly pronounced in the United States when compared to its North American counterparts Canada and Mexico. As one might expect given the great deal of latitude afforded to countries under the World Trade Organization's Antidumping Agreement, the results from this project reveal a number of significant differences in the factors that countries use to make their antidumping determinations. For example, while investigating authorities in the United States and European Union take into account both the share of imports from the country under investigation as well as the growth in these imports when determining whether the imports are causing injury to the domestic industry, authorities in other countries appear to primarily use only one of these variables in their decision-making process. Finally, the results from this project suggest that the current outlets available to countries may be of little help in resolving disagreements over antidumping investigation methodologies. Although disagreements over antidumping statutes have accounted for over one quarter of the dispute settlement cases initiated at the WTO since 1999, the complaints involving antidumping and countervailing duty actions are 14 percent less likely to be resolved in the dispute settlement system than other dispute settlement cases.
Publications
- "Dumping on Farmers: Are there Biases in Global Antidumping Regulations," Journal of International Agricultural Trade and Development, 2007, 3(2): 135-154.
- "From Agreement to Application: A Cross-Country Analysis of Injury Determinations under the WTO Antidumping Agreement," forthcoming in Review of International Economics, accepted April 2008, expected date of publication 2009.
- "Politics and WTO Dispute Settlement: Why Are So Many Disputes Still Pending" forthcoming in James Hartigan (ed.), Trade Disputes and the Dispute Settlement Understanding of the WTO: An Interdisciplinary Assessment. Accepted June 2007, expected date of publication 2009.
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Progress 09/01/06 to 08/31/07
Outputs
Over the past year, I presented the results from 'From Agreement to Application: A Cross-Country Analysis of Injury Determinations under the WTO Antidumping Agreement' at a number of important conferences (see complete list in the Publications section of this report). The major findings from this paper were presented in my 2006 progress report. After incorporating a number of revisions suggested by participants in these conferences, the paper has been submitted to the Review of International Economics for consideration. I also completed a compendium of antidumping regulations in twelve of the leading users of antidumping protection within the World Trade Organization (WTO). The compendium, and individual country reports, can be found on my website, http://nw08.american.edu/~reynolds/antidumping.html. An analysis of these regulations reveals that although each country has a number of idiosyncratic procedures and rules that may result in higher levels of antidumping
protection in some countries when compared to others, regulations in virtually all countries are in compliance with the WTO Antidumping Agreement. A large number of disputes over antidumping regulations have arisen in the WTO over the past 10 years, particularly against procedures in Argentina, the European Union, Mexico and the United States. Although this may suggest that the regulations/procedures in these countries violate the WTO Antidumping Agreement more than in other countries, the analysis included in the third paper from this project, 'Why Are So Many WTO Disputes Abandoned' reveals that many of these disputes may be filed solely to try to extract concessions during the periodic reviews that take place regarding the level of antidumping protection in specific cases. Specifically, WTO disputes involving antidumping regulations are more than 14 percent more likely to be abandoned or withdrawn during the WTO dispute settlement process, an indication that disputes involving
antidumping regulations are less likely to have legal merit. I am currently in the process of analyzing the economic and political determinants of the level of antidumping duties across countries and industries. Data for this analysis has already been collected, and I am beginning the empirical analysis using a random-coefficients tobit model.
Impacts
Future research on the impact of international agreements on U.S. producers can better account for variation in regulations across countries and industries using the random-coefficient methodologies developed for this project. The results from this research suggest that if the United States values consistency in antidumping determinations across countries, U.S. policy makers should negotiate for more stringent antidumping regulations at the WTO. Moreover, although there is no indication that countries treat the agricultural sector differently from other sectors during antidumping investigations, results suggest that perhaps special considerations should be made for this unique sector in future agreements. The future of U.S. agricultural exports may rely on leveling the antidumping playing field across countries and industries if the amount of foreign antidumping protection continues to grow.
Publications
- Reynolds, Kara M. 2007. Dumping on Agriculture: Are There Biases in Antidumping Regulations. Journal of International Agricultural Trade and Development 3(2).
- Reynolds, Kara M. November, 2006. From Agreement to Application: A Cross Country Analysis of Injury Determinations Under the WTO Antidumping Agreement. Presentation at the Southern Economic Associations Meetings, Charleston, South Carolina.
- Reynolds, Kara M. December, 2006. From Agreement to Application: A Cross Country Analysis of Injury Determinations Under the WTO Antidumping Agreement. Presentation at the Antidumping and Developing Countries Conference, Paris, France.
- Reynolds, Kara M. March, 2007. From Agreement to Application: A Cross Country Analysis of Injury Determinations Under the WTO Antidumping Agreement. Presentation at George Washington University, Washington, DC.
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Progress 09/01/05 to 08/31/06
Outputs
In the first phase of the project, I completed 36 case studies detailing the cause and effect of all antidumping investigations involving the United States between 1995 and 2004. These case studies are currently available at my website, http://nw08.american.edu/reynolds/casestudies.pdf, and a paper summarizing these case studies, 'Dumping on Farmers: Are There Biases in Global Antidumping Regulations?' has been accepted for publication by the Journal of International Agricultural Trade and Development. The case study analysis revealed that agricultural producers file a disproportionate share of antidumping petitions. However, virtually all of the agriculture-related investigations initiated by the United States, Mexico and Canada were against their NAFTA partners, suggesting that the high level of antidumping activity in the agriculture sector could simply be an indication of the high degree of conflict in the North American agriculture industry. I found little
statistical evidence that antidumping duty determinations are higher in the agricultural sector when compared to other industries. However, there is evidence that antidumping duties are more often imposed upon agricultural products than other products. In other words, investigations involving agricultural products more often result in the imposition of duties than those involving other products. The analysis also suggests that differences in country-specific antidumping regulations may cause the level of agricultural bias to be higher in some countries when compared to others. In the second phase of the project, I collected information from the World Bank's Antidumping Database, the UN's Commodity Trade Database, and UNIDO's Industrial Statistics Database. The resulting dataset includes detailed information on the outcome of all antidumping investigations initiated by twelve countries between 1995 and 2004, as well as the economic and political characteristics of the countries and
industries involved in each investigation. I have employed this data in the second paper associated with this project, 'From Agreement to Application: A Cross-Country Analysis of Injury Determinations under the WTO Antidumping Agreement.' Using a random-coefficients probit model, I estimate the determinants of antidumping injury investigations. The results reveal that there is significant variation in the determinants of antidumping decisions across countries. For example, the value of imports from the country under investigation has a much higher impact on the likelihood of success in high-income countries than in developing countries. I find no significant difference in the determinants of agriculture-related investigations when compared to others. However, agriculture-related investigations are more likely to result in protection due to the characteristics of the industry. Finally, I have started to analyze country-specific antidumping regulations, and the antidumping-related
disputes initiated at the WTO, in an effort to determine the degree of compliance with the WTO's Antidumping Agreement.
Impacts
I have been invited to present the results from the first year of this project at both the Southern Economic Conference in November 2006 and the World Bank's 'Antidumping and Developing Countries Conference' in December 2006. Once disseminated, I believe that these results will be of significant help to both future researchers and policy makers. For example, estimates from my model suggest that researchers must take into account the fact that average parameter values can mask significant differences across countries and industries. Future research on the impact of international agreements on U.S. producers can better account for this variation using the methodologies developed for this project. Perhaps more importantly, the results suggest that if the United States values consistency in antidumping determinations across countries, U.S. policy makers should negotiate for more stringent antidumping regulations at the WTO. Moreover, although there is no indication that
countries treat the agricultural sector differently from other sectors during antidumping investigations, results suggest that perhaps special considerations should be made for this unique sector in future agreements. The future of U.S. agricultural exports may rely on leveling the antidumping playing field across countries and industries if the amount of foreign antidumping protection continues to grow.
Publications
- No publications reported this period
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