Law and Economics
Business Strategy and Operations
“Typically, antidumping duties are levied when foreign
average prices are below average cost of production.
But that also describes a practice that often emerges as
a wholly appropriate response to a softening in demand.
It is the rare case that prices fall below marginal cost,
which would be a more relevant standard.”
Chairman Alan Greenspan, Federal Reserve, Trade and Technology, 1999
Growing international trade has stimulated competition among nations’ industries and created new challenges and opportunities for U.S. and other businesses. Corporations with international sales face not only new competition, but also an array of constraints, such as antidumping laws, market share arrangements, and export controls. Each constraint can alter dramatically the competitive environment. Changes in the laws governing international trade have also resulted in a number of new opportunities. For example, U.S. trade law now permits domestic firms to challenge overseas market barriers before U.S. authorities.
The increasing complexity of trade disputes has fostered expanded interest in sophisticated economic reasoning. EI can meet client requirements for research, strategic guidance, and expert testimony, as well as speech drafting and support for legislative initiatives. Evaluation of a trade problem or the conduct of a major trade case may be required. Whether the clients are domestic or foreign, detailed knowledge of policy, law, institutions, and industries is essential. Effective economic analysis must be competent, creative, and intelligible to non-economists.
EI has participated in the full range of trade matters, including antidumping and countervailing duty investigations, escape clause investigations, and economic policy analysis. EI economists have extensive experience inside the relevant government agencies. They have prepared studies and testimony for the International Trade Commission (ITC), U.S. Trade Representative, and other agencies. EI economists served on inter-agency committees that considered a variety of trade policy questions. EI economists have also worked on responses to petitions to restrict imports under Section 232 of the Trade Expansion Act of 1962 and have provided public benefit analysis and testimony for foreign trade zone applicants and operators.
EI economists have published articles on trade issues, including the protection of intellectual property rights, the relationship between U.S. competitiveness and the trade deficit, the effects of tax changes on trade, and the implications of trade law revisions. In addition, EI economists have appeared before antitrust authorities for foreign and domestic clients interested in forming joint ventures or making acquisitions.
Antidumping, Countervailing Duty, and Escape Clause Cases
EI economists have participated in numerous import injury investigations before the ITC, including investigations in sweaters, cement, coated paper, welded carbon steel pipe and tube, and oil country tubular goods. As a result, EI economists are familiar with the standards used by the ITC in its investigations, and can use this knowledge to assess the strength of a client’s case and to properly focus the analysis. In this context, EI economists have analyzed the issues of “like products,” substitutability of foreign and domestic product, geographic market, and injury. In recent years, the ITC has increased its use of econometrics and other economic tools. EI has developed the ability to employ and critique the analytical approaches used by the Commission staff, such as the COMPAS model.
EI has experience before the Commerce Department in analyzing the magnitude of dumping margins and countervailable subsidies. EI economists have examined the Department of Commerce subsidy methodology and prepared computer records for antidumping investigations.
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