Antidumping and Market Power in the Agriculture Sector, with a Special Case Study of the Fresh Tomato Industry

In this article we highlight the anticompetitive nature of antidumping (AD) legislation. Antidumping legislation was set up to protect domestic firms from predatory pricing by foreign firms. We argue that protecting highly concentrated industries drastically reduces competition at home. In cases whe...

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Bibliographic Details
Main Author Baylis, Katherine R
Format Journal Article
LanguageEnglish
Published 2008
Subjects
agriculture
antidumping legislation
competition
Crop Production/Industries
fresh tomato industry
International Relations/Trade
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Summary:In this article we highlight the anticompetitive nature of antidumping (AD) legislation. Antidumping legislation was set up to protect domestic firms from predatory pricing by foreign firms. We argue that protecting highly concentrated industries drastically reduces competition at home. In cases where the industry consists only of one or two firms, import restriction may breed monopolies at the expense of domestic consumers. This article looks at cases filed by the agriculture sector, and at the market concentration of industries in this sector, to illustrate the above possibility. We study the case of fresh tomatoes in detail to further demonstrate the anticompetitive nature of AD legislation. We show the effect of AD legislation on imports, as well as the change in the Lerner index in the fresh tomato industry.
Bibliography:29995
http://purl.umn.edu/6320