Firm Entry and Market Interdependence: Evidence from anti-du mping tariffs on Chinese exports
Abstract:
Using Chinese Customs data, we study how unilateral anti-dumping (AD) tariffs on Chinese products affect their exports to diffe rent destination countries. We first document that investigated products ex perience a decline in their total sales in both the countries that impose t ariffs (focal countries) and those that do not (third countries). A decompo sition exercise further suggests that the simultaneous declines in exports across countries are primarily driven by a reduction in the number of entra nts. In contrast, individual exporters’ sales decrease in the focal countri es but increase in the third countries. To rationalize these facts, We deve lop an industry equilibrium framework based on firms’ interdependent entry decisions to multiple markets. We show that the entry margin alone can gene rate cross-market policy spillovers and heterogeneous tariff responses cons istent with the data. Finally, we calibrate our model and quantify the glob al impact of a unilateral tariff on trade and welfare.
DTSTAMP:20260406T180437Z DTSTART:20250409T130000Z DTEND:20250409T140000Z SEQUENCE:0 TRANSP:OPAQUE END:VEVENT END:VCALENDAR