WHO BENEFITS FROM ANTIDUMPING LEGISLATION

Antidumping laws alter the pricing policies of foreign firms to the benefit of domestic ones. Unilaterally, domestic firms want to lobby for antidumping restrictions; unilaterally, consumers want to lobby against them. This paper shows that if firms succeed in both countries, their profits fall and consumer surplus rises, so that firms end up working for consumers everywhere by lobbying. It also shows that each government, maximizing total domestic surplus, prefers no legislation irrespective of the action of another government. However, world surplus may be greater with antidumping rules. These results hold under both Bertrand and Cournot competition.