Anti‐Dumping Duty and Firm Heterogeneity: Evidence from Korea

24 Pages Posted: 13 Sep 2017

See all articles by Joo Yeon Sun

Joo Yeon Sun

Korea Institute for International Economic Policy

Seungrae Lee

Kyungpook National University

Date Written: September 2017

Abstract

This study examines the imposition of anti‐dumping (AD) duties on imported products in Korea. We use panel data for Korean firms between 2000 and 2012 and estimate the firm‐level productivity of import‐competing firms before and after AD imposition. Using a difference‐in‐difference framework, we compare firm productivity changes in a treatment group that receives AD protection to a control group that does not. In contrast to recent findings on the effects of AD measures, we find that the average protected firms experience productivity loss during the AD protection period. Examining the changes in external market condition and internal resource allocation during the protection period, such loss appears to be more evident inside highly concentrated import‐competing sectors. Further, we find that protected firms are more likely to reallocate their resources abroad via FDI at the expense of domestic production and investment once they receive temporary protection.

Suggested Citation

Sun, Joo Yeon and Lee, Seungrae, Anti‐Dumping Duty and Firm Heterogeneity: Evidence from Korea (September 2017). The World Economy, Vol. 40, Issue 9, pp. 2007-2030, 2017. Available at SSRN: https://ssrn.com/abstract=3036196 or http://dx.doi.org/10.1111/twec.12463

Joo Yeon Sun (Contact Author)

Korea Institute for International Economic Policy ( email )

[30147] Building C, Sejong National Research Compl
Seoul, 370
Korea, Republic of (South Korea)

Seungrae Lee

Kyungpook National University ( email )

Korea, Republic of (South Korea)

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