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Antidumping and Feed-In Tariffs as Good Buddies? Modeling the EU-China Solar Panel Dispute

Patrice Bougette () and Christophe Charlier ()

No 2017-17, GREDEG Working Papers from Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), University of Nice Sophia Antipolis

Abstract: The paper analyzes the interactions between trade and renewable energy policies based on the EU--China Solar Panel dispute which is the most significant antidumping (AD) complaint in Europe. We build a price competition duopoly model with differentiated products and intra-industry trade in photovoltaic equipment. We provide two relevant types of AD duties. The optimal AD which maximizes social domestic welfare always increases with the feed-in tariff (FIT) program set in the home country. The appropriate AD -- equalizing the foreign firm's price on the domestic market with the foreign market price -- decreases with the FIT program. We show that the optimal FIT increases with the AD duty. Therefore, trade and renewable energy optimal policies may complement one another. When setting AD duties in clean energy sectors, it is important not to ignore the extent to which renewable energy is subsidized.

Keywords: Antidumping; FIT; Solar Panels; Renewable Energy; Trade disputes; EU; China (search for similar items in EconPapers)
JEL-codes: F18 L52 Q42 Q48 Q56 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cna, nep-ene, nep-env, nep-int and nep-reg
Date: 2017-05
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http://www.gredeg.cnrs.fr/working-papers/GREDEG-WP-2017-17.pdf First version, 2017 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:gre:wpaper:2017-17

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