Economics of Anti-Dumping Import Tariffs

In this revision video we look at the issue of import dumping and the response of countries using retaliatory anti-dumping duties.

Import dumping happens when firms sell their exports at below average cost or below their normal prices in the home market. The former implies predatory pricing – which is illegal. Dumping might be part-financed by government subsidies.

An anti-dumping tariff is an additional import tax (import duty) above normal import tariffs that allows a country to act against goods sold at less than their normal value, defined as the price for 'like goods' sold in the exporter's home market.