infonet-economy

Using a standard linear version of the Bertrand duopoly model of competition, I analyse the effect on firm pricing behaviour of three prominent features of the U.S. antidumping system. I identify the circumstances under which these features eliminate dumping entirely as well as their effects on the profitability of the import-competing and foreign firms. The Byrd Amendment, which has been the subject of a dispute between WTO members, is found to create price floors for domestic firms and paradoxically to increase the volume and total value of imports.