Three essays on dumping and predatory pricing in international trade

Dumping is believed to be a form of protectionism. Furthermore, the use of an antidumping duty to prevent alleged dumping practice allows producers relief from foreign products that are competitively and fairly priced. In this three-essay dissertation, dumping, predatory pricing, and the impact of imposing an antidumping duty are analyzed.; The first essay analyzes the current definition of dumping and develops a mixed duopoly model. The focal point of the first essay is that the current definition of dumping is not designed to detect the unfair pricing strategy of long run profit maximization, rather it is defined only to evaluate a firm's short run behavior. In addition, this essay examines firms' intentions to price products below cost, using two-stage profit maximization. The results from the mixed duopoly model indicate that, for the private firm, setting price below cost may be optimal, but predatory pricing is not an optimal strategy for a public enterprise. Yet, the public firm's product may be treated as unfairly priced.; The second essay is an econometric approach to examine the economic impact of imposing an antidumping duty against Canadian live cattle exports to the United States. A two-region partial equilibrium model is developed. The Gauss-Seidel simulation algorithm is employed to solve the integrated dynamic cattle model. The results confirm that the use of an antidumping duty will have a negative effect on the growing trade between Canada and the US. Moreover, the simulated results indicate that US producers can use the antidumping duty to offset Canadian producers' advantage due to an exchange rate movement.; The third essay employs a time series approach to examine the impact of imposing an antidumping duty against the exports of Canadian cattle, using a time series model of prices, exports, and exchange rate. Applying recent advances in vector autoregressive analysis, an asymmetric autoregressive model is developed using the Winker (2001) optimization algorithm. The Pesaran and Shin (1998) generalized impulse response functions are also estimated. The results indicate that one possible reason why US producers filed a petition against Canadian producers was that they could increase their market share in the US domestic cattle market.