Antidumping Protection and R&D Competition

17 Pages Posted: 26 Jan 2005

See all articles by Xiwang Gao

Xiwang Gao

Emory University - Department of Economics

Kaz Miyagiwa

Emory University - Department of Economics; Osaka University - Institute of Social and Economic Research (ISER); Florida International University (FIU) - Department of Economics

Abstract

In recent years antidumping protection has spread throughout the world. Evidence shows that antidumping often targets R&D-intensive sectors, raising a concern that it may adversely affect worldwide investments in R&D. We investigate this issue in a model of reciprocal dumping extended to a two-stage game, in which two firms first choose R&D levels and then compete in prices. We find that, when a single government institutes antidumping law, the protected firm decreases investment in R&D, while the constrained firm invests more. When both governments engage in antidumping actions, both firms invest more in R&D than under free trade.

JEL Classification: F12, F13

Suggested Citation

Gao, Xiwang and Miyagiwa, Kaz, Antidumping Protection and R&D Competition. Canadian Journal of Economics, Vol. 38, No. 1, pp. 211-227, February 2005. Available at SSRN: https://ssrn.com/abstract=654075

Xiwang Gao (Contact Author)

Emory University - Department of Economics

1602 Fishburne Drive
Atlanta, GA 30322
United States

Kaz Miyagiwa

Emory University - Department of Economics ( email )

1602 Fishburne Drive
Atlanta, GA 30322
United States

Osaka University - Institute of Social and Economic Research (ISER) ( email )

6-1 Mihogaoka
Ibaraki Osaka 567-0047
Japan

Florida International University (FIU) - Department of Economics ( email )

Miami, FL 33199
United States

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