Policy Analysis No. 14
87 Pages Posted: 22 May 1998
Date Written: July 1996
Antidumping laws were designed to protect domestic industry from foreign competition. They protect producers at the expense of consumers, which results in higher prices, lower quality products, less consumer choice and a general lowering of the standard of living for the vast majority of people. Antidumping laws also destroy more jobs than they create.
Part I of this article provides an introduction and overview. Part II reviews the theory and practice of antidumping law in the United States. It looks at the economic and legal background of the area, the administration of the antidumping laws, and computational problems involved in arriving at an antidumping decision. It also provides examples of antidumping investigations in the areas of autos, steel, textiles, agricultural products, and televisions and discusses the harmful effects of antidumping policy. It also explores the predatory pricing argument as applied to antidumping.
Part III discusses some philosophical issues relating to antidumping law and policy. It views the antidumping laws as a club that can be used to batter the competition at the expense of consumers and questions the ethics of using government for this purpose. It also points out the silliness of antidumping policy, since it in effect protects consumers from low prices, and develops a rights-based argument against antidumping laws.
Part IV concludes that antidumping laws are harmful, serve no useful purpose and should be repealed, the sooner the better.
JEL Classification: F13, K2, L5
Suggested Citation: Suggested Citation
McGee, Robert W., Antidumping Laws as Protectionist Trade Barriers: The Case for Repeal (July 1996). Policy Analysis No. 14. Available at SSRN: https://ssrn.com/abstract=91268 or http://dx.doi.org/10.2139/ssrn.91268