Tariff-jumping FDI and domestic firms' profits

Bruce Blonigen, KaSaundra Tomlin and Wesley Wilson

Canadian Journal of Economics, 2004, vol. 37, issue 3, 656-677

Abstract: Studies of trade policy welfare effects often ignore the potential for tariff-jumping foreign direct investment (FDI) to mitigate positive gains to domestic producers. Using event study methodology we find that affirmative U.S. antidumping decisions are associated with average abnormal gains of over 3% to a firm in the petitioning industry in the absence of tariff-jumping FDI, but much smaller and statistically insignificant abnormal gains if there is tariff-jumping FDI. We also find evidence that tariff jumping in the form of new plants or plant expansion has significantly larger negative effects on U.S. domestic firms' profits than other types of tariff-jumping FDI.

JEL-codes: F13 F23 L11 (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (18)

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Working Paper: Tariff-jumping FDI and Domestic Firms' Profits (2002)
Working Paper: Tariff-jumping FDI and Domestic Firms’ Profits (2002)
Working Paper: Tariff-jumping FDI and Domestic Firms’ Profits (2002)
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