Plant-Level Responses to Antidumping Duties: Evidence from U.S. Manufacturers

36 Pages Posted: 9 Nov 2011

See all articles by Justin R. Pierce

Justin R. Pierce

Board of Governors of the Federal Reserve System

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Date Written: September 7, 2011

Abstract

This paper describes the effects of a temporary increase in tariffs on the performance and behavior of U.S. manufacturers. Using a dataset that includes the full population of U.S. manufacturing plants, I show that an apparent positive correlation between antidumping duties and traditional revenue productivity is likely misleading. For the subset of plants reporting quantity-based output data, increases in prices and markups artificially inflate the effect of antidumping duties on revenue productivity, while physical productivity actually falls. Moreover, antidumping duties allow low-productivity plants to continue producing protected products, slowing the reallocation of resources from less productive to more productive uses.

Keywords: Antidumping, temporary protection, heterogeneous firms, productivity

JEL Classification: F13, F14, D24

Suggested Citation

Pierce, Justin R., Plant-Level Responses to Antidumping Duties: Evidence from U.S. Manufacturers (September 7, 2011). FEDS Working Paper No. 2011-40, Available at SSRN: https://ssrn.com/abstract=1956750 or http://dx.doi.org/10.2139/ssrn.1956750

Justin R. Pierce (Contact Author)

Board of Governors of the Federal Reserve System ( email )

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