Trade Deflection, Retaliation, and Developing-Country Antidumping Initiation Against China

The proliferation of antidumping investigations directed at China in recent years raises the question of whether importing countries are motivated by retaliatory considerations in their filings against Chinese firms. This question is addressed through an empirical examination of the use of the antidumping instrument by developing countries. Empirical results suggest that China's actual and threatened retaliation against developing countries can generate both a retaliatory and a deterrent effect. They also suggest that the deflection of exports to developing countries has contributed to the rise in the latter's use of antidumping against Chinese firms.