Antidumping Exposed: The Devilish Details of Unfair Trade by Brink Lindsey

By Brink Lindsey

Shortly, the U.S. stands on my own in opposing significant reform-an untenable place. during this publication, the authors clarify how those insidious ideas have continued, and why and the way to advertise a profitable antidumping reform process.

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For example, there may be long-term strategic benefits that accompany a certain market position (and market share); staying the market leader through a temporary downturn may maximize long-term profitability. Also, if a downturn is seen as too temporary to justify permanent capacity cutbacks, it may pay to continue producing instead of allowing capacity to go idle. Here the distinction between marginal and sunk costs, or their real-world equivalents of variable and fixed costs, is crucial. If a company can continue to produce and sell goods above variable costs, it can at least make some contribution to fixed costs—costs that would be incurred even if those goods had not been produced.

39 ANTIDUMPING EXPOSED Another variation of cross-subsidization is a trade-up strategy. Here product varieties that are typically first purchases are sold at low prices, in the hopes that the buyer will later purchase other more profitable items in the line as trade-up occurs. 38 Selling below full unit costs may also make sense in the case of so-called coproducts or joint products—two or more different goods that are produced simultaneously in the same manufacturing process. Examples include different cuts of meat from the same animal, different ores extracted in the same mining operation, different chemicals produced by the same reaction, and products of varying quality produced in the same manufacturing batch.

5, the Taiwan SRAM market was not overtly protected: the tariff rate at the time of the investigation was only 1 percent. Assuming for the sake of argument that other ‘‘hidden’’ barriers did in fact shield the Taiwan market, the antidumping investigation nonetheless revealed that ISSI was not enjoying supernormal profits in Taiwan. S. S. 30 Consequently, its Taiwan market was not sufficiently large to serve as a base for subsidizing export sales. The lack of connection between affirmative dumping determinations and evidence of sanctuary markets is not surprising.

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