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International Economics

Steven Husted, Michael Melvin

Chapter 8

COMMERCIAL POLICY: HISTORY AND PRACTICE - all with Video Answers

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Chapter Questions

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Problem 1

Examine Figure 8.1 carefully. In what periods were U.S. tariffs high? When were they low? How do you explain these patterns?

Oluwadamilola Ameobi
Oluwadamilola Ameobi
Numerade Educator

Problem 2

What is the WTO? What services does it perform? Explain carefully.

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01:45

Problem 3

What is dumping? What are the welfare costs of dumping? Why would firms ever dump? Explain carefully.

Daniel Cisneros
Daniel Cisneros
Numerade Educator

Problem 4

Compare and contrast how the U.S. government handles antidumping and countervailing duty cases.

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01:14

Problem 5

What is Section 301 of U.S. trade law? Describe how it works. Do you think it is likely to be very effective? Comment.

Daniel Cisneros
Daniel Cisneros
Numerade Educator
01:42

Problem 6

In 1988, Senator Ernest Hollings of South Carolina was quoted as saying that "going the 201 route is for suckers." By this, he appeared to mean that American firms seeking protection from foreign competition would do better by using other trade remedies. Given your knowledge of how Section 201 and alternative forms of U.S. trade laws are administered, do you agree with the senator's statement? Why or why not?

Tristan Wille
Tristan Wille
Numerade Educator

Problem 7

A former ITC commissioner, Alfred Eckes, has written, "In battling dumping, trade administrators not only help sustain political support for an open global trading system, but they also bring benefits to consumers as well as producers. I remember well how imposition of U.S. antidumping duties against Korean television makers prompted them to lower high home market prices in order to avoid the payment of U.S. dumping duties." Comment on Mr. Eckes's statement. Do you agree or disagree with its general thrust? Support your answer with examples from how U.S. policy is applied and recent world experience with such policies.

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02:32

Problem 8

The late Milton Friedman often wrote that instead of imposing countervailing duties on subsidized foreign goods, the United States should write a note of thanks to foreign taxpayers. Do you agree? Why or why not? Illustrate with a simple diagram.

Tristan Wille
Tristan Wille
Numerade Educator

Problem 9

What are the benefits and costs of U.S. antidumping laws?

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02:38

Problem 10

How likely is dumping to be predatory? Discuss.

Ansh Varma
Ansh Varma
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