【文章內(nèi)容簡(jiǎn)介】 r at a lower price abroad than domestically in order to unload an unforeseen and temporary surplus of the modity without having to reduce domestic prices Dumping ? Measures to counteract predatory dumping: justified ? antidumping duties or the threat to impose such duties ? difficult to determine the type of dumping ? domestic producers demand protection against dumping to increase profit ? persistent and sporadic dumping: the benefit to consumers from low prices may exceed the possible production losses of domestic producers Dumping ? Over the past three decades, Japan was accused of dumping steel and television sets in the US, and European nations of dumping cars, steel, and other products. ? Many industrial nations especially those that belong to the EU, have a tendency to persistently dump agricultural modities arising from their farm support programs Dumping ? When dumping is proved, the violating nation or firm usually chooses to raise its prices rather than face antidumping duties. ? In 1980s, only eight countries had antidumping laws。 ? by the end of 2021, 97 countries (counting the EU as a single member) had them (including many developing countries) Dumping ? In 1978 triggerprice mechanism in US: foreign steel producers who sold steel in US at prices below the lowestcost was subject to a speedy antidumping investigation ? Since 1992, when VERs on steel exports to the US expired, . steel producers have filed hundreds of antidumping suits against foreign steel producers Export Subsidies ? Export subsidies: direct payments or the granting of tax relief and subsidized loans to the nation’s exporters and/or lowinterest loans to foreign buyers so as to stimulate the nation’s exports ? be regarded as a form of dumping ? illegal by international agreement but many nations provide them in disguised and notsodisguised forms Export Subsidies ? All major industrial nations give foreign buyers of the nation’s exports lowinterest loans to finance the purchase through agencies like the . ExportImport Bank ? Lowinterest credits finance about 2% of . exports Export Subsidies ? Most serious trade plaints that the US has against other industrial countries today ? The amount of subsidy can be measured by the difference between the interest that would have been paid on a mercial loan and what is in fact paid at the subsidized rate ? In 1996, the US provided about $1billion in such subsidies and Japan, France, and Germany two to three times that amount Export Subsidies ? very high support prices provided by EU to maintain its farmers’ ine under its mon agricultural policy (CAP) ? huge agricultural surpluses and subsidized exports, taking export markets away from other countries, and the sharpest trade controversies between the US and the EU ? Countervailing duties (CVDs) are imposed on imports to offset export subsidies by foreign governments Partial Equilibrium Effect of an Export Subsidy Partial Equilibrium Effect of an Export Subsidy ? free trade price: Px=$ ? small Nation 2: produces 35X(A′C′),consumes 20X(A′B′),and exports 15X(B′C′) ? With a subsidy of $ on each X exported, Px rises to $ for domestic producers and consumers ? At Px=$4, Nation 2 produces 40X (G′J′), consumes 10X (G′H′), and exports 30X (H′J′) Partial Equilibrium Effect of an Export Subsidy ? Domestic consumers lose $(area a′+b′), ? domestic producers gain $(area a′+b′+c′) ? government subsidy: $15(b′+c′+d′) ? Protection cost (deadweight loss): $(the sum of triangles B′H′N′) =b′=$ and C′J′M′=d′=$). The Political Economy of Protectionism ? analyze the various arguments for protection ? clearly fallacious propositions ? arguments that can stand up, with some qualification ? close economic scrutiny Fallacious and Questionable Arguments for Protection ? fallacious: protect domestic labor against cheap foreign labor ? even domestic wages are higher than wages abroad, domestic labor can still be lower if the productivity of labor is sufficiently higher domestically than abroad ? Even if not the case, mutually beneficial trade could still be based on parative advantage, the expensivelabor nation specializing in the production of and exporting capitalintensive modities Fallacious and Questionable Arguments for Protection ? Fallacious: the scientific tariff ? the tariff rate that make the price of imports equal to domestic prices and allow domestic producers to meet foreign petition ? eliminate international price differences and trade in all modities Fallacious and Questionable Arguments for Protection ? Questionable: ? (1) to reduce domestic unemployment ? (2) to cure a deficit in the nation’s balance of payments ? leading to the substitution of imports with domestic production ? e at the expense of other nations Fallacious and Questionable Arguments for Protection ? causes greater unemployment and worsened balance of payments abroad ? Other nations are likely to retaliate, and all nations lose in the end ? Domestic unemployment and deficits in the nation’s balance of payments should be corrected with appropriate moary, fiscal, and trade policies rather than with trade restrictions Qualified Arguments for Protection ? Infantindustry argument ? a nation may have a potential parative advantage in a modity, but because of lack of knowhow and the initial small level of output, the industry cannot pete with more established foreign firms The InfantIndustry Temporary trade protection to protect the domestic industry during its “infancy” until it can meet foreign petition, achieve economies of scale, and reflect the nation’s longrun parative advantage ? protection