Design of an Antidumping Rule with Incomplete Information about Material Injury

Philippe Kohler () and Michael O. Moore
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Philippe Kohler: University of Montpellier, Postal: Department of Economics, University of, Montpellier, Avenue de la Mer, BP 9606, 34054 Montpellier, France
Michael O. Moore: The George Washington University, Postal: The George Washington University

Journal of Economic Integration, 1998, vol. 13, 62-88

Abstract:

This paper deals with the inability of an administering authority to directly observe the level of material injury in antidumping petitions. We focus on the use, by the domestic firm, of private information about injury in order to obtain higher protection. By using an incentive framework, we show that asym - metric information about the level of injury can be resolved by using a mix of lump-sum compensation, domestic unit taxes and antidumping duties rather than just import duties. Surprisingly, the lump-sum transfer decreases and the domestic unit tax increases with the level of material injury. This efficient antidumping rule will induce the domestic firm to tell the truth about the level of material injury.

Keywords: Antidumping; Rule (search for similar items in EconPapers)
JEL-codes: F13 L50 (search for similar items in EconPapers)
Date: 1998
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ris:integr:0066

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