Antidumping Policy, Price-undertaking and FDI
Resource
經濟論文叢刊, 36(4), 463-481
Journal
經濟論文叢刊
Journal Volume
36
Journal Issue
4
Pages
463-481
Date Issued
2008-12
Date
2008-12
Author(s)
Peng, C.H.
Hwang, H.
Abstract
This paper employs the barbell model ? la Hwang and Mai (1990) with one foreign and one domestic market existing at the two ends of a line market. There is one foreign firm competing with one domestic firm in the domestic market. We shall examine how an antidumping policy affects the FDI decision of the foreign constrained firm. This goes beyond previous studies by treating the FDI decision (i.e., the location of the foreign firm) as an endogenous and continuous variable which allows us to examine thoroughly the location pattern of the foreign firm. Our main findings are as follows: (i) If the fixed cost of FDI is not high, the foreign firm will definitely engage in FDI when it is subject to an antidumping policy. This result is in support of the empirical finding of Blonigen (2002). (ii) The foreign firm with a higher marginal cost is more likely to engage in FDI, if constrained by an antidumping policy. This result is contrary to those prevailing in the FDI literature in the absence of antidumping constraints, e.g., Melitz (2003).
Subjects
反傾銷保護
外人直接投資
價格具結
antidumping protection
foreign direct investment
price-undertaking
SDGs
Type
journal article