第11章PushingExport.pptVIP

Chapter eleven Pushing Export Dumping Dumping: selling exports at a price that is too low- less than normal value (“fair market value”). Normal value: the price charged to comparable domestic buyers in home market. international price discrimination favoring buyers of exports. Normal value: cost-based, the average cost of producing the product. Dumping Predatory dumping: temporarily, driving the foreign competitors out of business, monopoly power, high profits Cyclical dumping: recession, lower its price to limit the decline in quantity sold. Variable cost Seasonal dumping: sell off excess inventories of a product. Persistent dumping: market power, price discrimination between markets Persistent dumping Less monopoly power in foreign market. Buyers in the home country can’t buy the good abroad and import it cheaply to avoid the high home prices. Profit-maximizing price: MC=MR Transport cost and import barriers keep these two markets separate Persistent dumping The market in Japan the U.S market for this firm’s export Reacting to Dumping: What Should A Dumpee Think? Persist dumping consumer surplus terms of trade welcome, thank seasonal dumping persistent dumping Reacting to Dumping: What Should A Dumpee Think? Predatory dumping Negative: sure losses, possible but uncertain profits in the future, current competitor, future new competitor Reacting to Dumping: What Should A Dumpee Think? Cyclical dumping: demand declines, to cover variable cost. Global recession: global share of the decline in demand, fair for the importing country to suffer? National recession: fair that the exporting country to export some of its unemployment? Actual Antidumping Policies WTO permits retaliation against dumping, if it injures the import-competing producers. In the 1980s, US, EU, Canada, and Australia “the Traditional Four” Most frequently charged countries: US, China, Japan, EU and Korea, Taiwan,