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Chinese Firm and Industry Reactions to Antidumping Initiations and Measures

Author

Listed:
  • Chunding Li
  • John Whalley
Abstract
Because of large and rapid growing export volumes and its formal status as a non-market economy; China has been the subject of large numbers of both antidumping initiations and measures. Current estimates are that around 40% of such actions are against China; India, in turn, is the largest source of initiation against China by number of actions. Here we explore the reactions of Chinese firms and industries to these actions. No other papers to our knowledge explore these reactions empirically. We use industrial panel data on all Chinese firms in the industry, foreign firms operating within China and state owned enterprises (SOE) for aggregated firms group between 1997 and 2007. This provides information on sales, profits, firm numbers, labor productivity, and employment. We are able to link this data with a World Bank dataset on antidumping actions by industry by country (both by and against) for the same period. We then use a dynamic system GMM estimator to explore the importance of different forms of Chinese firms' overall response to both initiations and measures. We also separately analyze antidumping actions against China from developed and developing countries, US and EU to compare their different effects. We find that antidumping actions by developed and developing countries negatively impact industrial profits and employee and firm numbers and also exports. Output impacts are the smallest. Labor productivity is improved by antidumping actions. We also find that different kinds of firms show different responses. All firms together in an industry react to antidumping the most, and foreign and SOE firms show a much smaller response. Also, developed countries' antidumping actions have more negative impact than developing countries' actions for all firms and SOEs, but foreign firms' impacts are the opposite. Chinese industry reactions to antidumping actions by the US and EU are the same as for other developed countries, but the effects of US actions are larger. US antidumping actions have more impact than EU's on firm numbers, employees and exports, and EU antidumping has more influence than US on output, profit and labor productivity. Finally, comparing Chinese, foreign, and SOE firm's reactions to US and EU antidumping actions, our results show foreign firms to be hurt more by antidumping from EU. We discuss policy implications in a concluding section.

Suggested Citation

  • Chunding Li & John Whalley, 2010. "Chinese Firm and Industry Reactions to Antidumping Initiations and Measures," NBER Working Papers 16446, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:16446
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    Cited by:

    1. Feng, Xiaoli & Li, Wenjing & Peng, Yuanhuai & Tan, Youchao, 2021. "International trade friction and the cost of debt: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 67(C).
    2. Sébastien Jean & Kevin Lefebvre, 2024. "Beyond Target: Indirect Impacts of Antidumping," CESifo Working Paper Series 11212, CESifo.
    3. Xiuping Hua & Ying Jiang & Qian Sun & Xinyi Xing, 2019. "Do antidumping measures affect Chinese export-related firms?," Review of Quantitative Finance and Accounting, Springer, vol. 52(3), pages 871-900, April.
    4. Gianpaolo Rossini, 2019. "State Owned Enterprises (SOEs) and Non Transparent Trade Policies," Italian Economic Journal: A Continuation of Rivista Italiana degli Economisti and Giornale degli Economisti, Springer;Società Italiana degli Economisti (Italian Economic Association), vol. 5(3), pages 433-453, October.
    5. Li, Wanli & Li, Yue & Jacoby, Gady & Wu, Zhenyu, 2022. "Antidumping, firm performance, and subsequent responses," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 76(C).
    6. Yeo Joon Yoon & Wongi Kim, 2022. "Dynamic analysis of antidumping using impulse responses: a case between the United States and China," Empirical Economics, Springer, vol. 63(2), pages 671-694, August.
    7. Yan Zhang, 2017. "Impact of Latin-American and Caribbean Antidumping Measures on Chinese Exports," IDB Publications (Working Papers) 97857, Inter-American Development Bank.
    8. Septiyas Trisilia, Mustika & Widodo, Tri, 2019. "Impacts of China Coal Import Tariff against US on Global Economy and CO2 Emissions," MPRA Paper 91231, University Library of Munich, Germany.
    9. Hilpert, Hanns Günther, 2013. "Chinas Handelspolitik: Dominanz ohne Führungswillen," SWP-Studien S 22/2013, Stiftung Wissenschaft und Politik (SWP), German Institute for International and Security Affairs.
    10. Chandra, Piyush, 2016. "Impact of temporary trade barriers: Evidence from China," China Economic Review, Elsevier, vol. 38(C), pages 24-48.
    11. Chandra, Piyush & Long, Cheryl, 2013. "Anti-dumping Duties and their Impact on Exporters: Firm Level Evidence from China," World Development, Elsevier, vol. 51(C), pages 169-186.
    12. Xiaoyong Qiao & Xue Chen & Ziwen Zhang, 2024. "The Impact of Anti-Dumping Measures on the Export of Intermediate Goods in Chinese Manufacturing Industry - Based on the perspective of ownership of importing firms," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 14(5), pages 1-13.
    13. Li, Yue & Li, Wanli, 2022. "Are innovative exporters vulnerable to anti-dumping investigations?," Technovation, Elsevier, vol. 112(C).

    More about this item

    JEL classification:

    • F1 - International Economics - - Trade
    • F10 - International Economics - - Trade - - - General

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