MỤC LỤC
Explore how the Vietnam footwear industry and Vietnam footwear firms response to antidumping duty from EU.
How much does AD effect on the firm’s input decision: firm’s size and labor payroll?.
Research methodology, data and scope
Thesis structure
Given assumption Home government imposes a specific tax (t) per unit import of product A. Without tariff, price of product A in Domestic country is equal to world price PE as illustration in middle of figure 2.3. Within the participation of tariff t, Mediators will not have incentive to move products from Foreign to Home unless the gap between the two prices is greater than or at least equal to t. Consequently, there is an excess supply in Foreign and shortest supply in. phenomenon makes an adjustment in Home and Foreign prices. There is an increase in Home price as well as a decrease in Foreign price until the difference between the two is t. Home Market World Market Foreign Market. Impact of tariff on import price and volume. Looking at figure 2.3, a tariff t makes price in Home increase to Pt that is greater than original price P. at Price Pt, Home producers incline to produce more. Besides that, there is less demand on import; in middle panel of figure 2.3, import move from point E to point A after introducing tariff. As a result, Foreign supplier alleviate export from point E to point B on XS curve. In addition, there is more demand in Foreign since price is lower. In short, traded quantity is reduced from Qe to Qt. The new equilibrium point of Home import demand and Foreign export supplied is established at Qt. At this point, Home price is higher than Foreign t. It is noticed that Pt – Pf. Hence, there are two cases: 1) Home country is small country, 2) It is large country. Term of trade gains is equal to zero and there is only efficiency loss (b + d). Home Market World. Effect of tariff on Home deman d in case of small countr y. Brander & Spencer, 1984; Dixit, 1984) argues Home price will be higher after government imposes tariff in any of specific or ad valorem. Also, they prove that if the Home country is large enough, tax might pass-through a part to Home customers and the rest for Foreign producers. Krugman, 1979) gives evidence for the case of monopolistic.
In addition, GATT/WTO conditions to raise AD are flexible and easy to interpret (Hansen &. Prusa, 1995), As discussed by (Blonigen & Prusa, 2001; Herander & Schwartz, 1984; Sabry, 2000), there are three main factors determine AD filing: injured sector employment, capital intensive of this sector and invasion of Foreign product. Paper of (Blonigen & Prusa, 2001) is a reviewed paper that summaized previous studies; and the rest two apply industry level data and single equation to to get their findings.
In addition, (Ganguli, 2008) examine a considerable fall of import to India of named countries while there are increase of import value from non-named countries. However, this result seems not strong when (Konings & Vandenbussche, 2005) use panel data from four thousands producers in EU before and after filing duty. This paper uses a unique of ex-ante and ex-post Enterprise Survey from Vietnam to verify impact of AD from EC on Vietnam footwear industry, thus, fits well this gap.
From theory views, As mentioned in section II.1.2, (Akerlof & Yellen, 1986; Feenstra, 2003) gave excellent explanations for questions how do antidumping duties effect on “named” industries export. Then, we can believe that AD might cause a diversion of targeted firms toward new markets or new products that are similar but not suffer to tariff to avoid AD.
EU is the largest importer of Vietnam footwear with 2198294 thousands of Euros in 2004(source http://madb.europa.eu/madb/statistical_form.htm#.). One of Vietnam major product footwear is footwear with outer soles of leather or upper leather which have code 6403 in 8-digit Combined Nomenclature (CN8). On July 7, 2005, EC announces the notice of launching of anti-dumping inspect on Vietnam and China leather shoes based on claim of European Confederation of the footwear industry (“CEC”) (C166/14/2006).At that time, CEC represents for 40% of EU suppliers.
There are eight Vietnam firms and twelve China firms are chosen as sample of 163 and 86 respondents of the two respectively. EU import Vietnam AD footwear and non-AD footwear Source: author collected data from http://epp.eurostat.ec.europa.eu/newxtweb/.
A descriptive statistics of import value, volume and price to EU from Vietnam AD footwear, its relative from Thailand, Indonesia, and Vietnam Apparel export to EU is given in table 3.2.We take average for two period, the first is 2004 and before; the second is 2006 and after. India, country that EU uses as control to assess Vietnam,goes up 146.6%.In addition, averagegrowth rate of 8-digit apparel, a similar product to footwear, is 91.5%. On those given, general trend in 8-digit data shows Vietnam AD footwear volume and value export to EU is significantly fall in relatively with the others countries and apparel industry.
For robustness, we change control group by enhancing control group totextile, paper & wooden products.Data description of variables related to our analysisis demonstratedin table 4. We are using import data which is categorized by Harmonized Tariff Schedule number.Data at 10-digit level is available and it is smallest unit, hence, we will adopt this for our research.
Source of time-invariant heterogeneity is different out as (Ai – Ai) that is equal to zero.
For quantity, Indonesia has risen rapidly from period 200-2002 before falling down quickly in 2002-2004 while Thailand, again, down significantly after 2007. For robustness, we do regression on Indonesia, Thailand and Vietnam Apparel to see different control group will cause different results that suitable to their trends. The fact that consequence of AD is greater for the two in 2003-2007 as Vietnam Apparel have extremely surge and Indonesia recover strongly relative to average trend of 1999-2011.
(column 7) corresponding to period 1999-2011 and 2003-2007.On those given, it is clearly AD has strong negative effect on EU import quantity and value of Vietnamese AD footwear. Looking first at column 1 and column 4, there is no evidence that India have difference with Vietnam export since the confident level is lower than 10%.
In addition, variable Fw illustrates that there is also no evidence of difference between footwear industry and the other industries because all confident level are greater than 10%. Kit, Lit, represents for number of female employee, total of employee, total capital source of firm i at the beginning of year t respectively.(Abowd, Kramarz, & Margolis, 1999)confirms a correlation of wage with capital to employee ratio, firm size and female ratio. It is similar to section 4.4.1 that Fw is omitted in some columns since control and treatment group are two close to disclosure coefficient for industry dummy.
In three time-variant firm characteristics control, there is only firm size (lnL) has significant level at 1% in all three columns (2), (4), (6), the others do not have statistics meaning even at 10%. In summary, section 4.4.1 and 4.4.2 provides strong evidence in empirical that EU AD might not have much effects on Vietnam firm in revenue, labor payroll and firm size even it causes a significant.
In summary, Indonesia and India are two potential candidates control for Vietnam Non-AD footwear while Thailand might be used as extra control in price. Oppositely, I find that AD associate with - 45.4% and 40% declines of Vietnam Non-AD footwear in the two period when use Vietnam Apparel as control.It is reminded that Figure 4.4 provides general trend of Indonesia, India and Vietnam Apparel is close to Vietnam Non-AD Footwear export value in 1999-2005. In addition, coefficient of Vn variable expresses a 143.4%, 59.6%, and 105.5% higher of Vietnam Non-AD export compare to India, Indonesia, and Thailand correspondingly.
There is no empirical evidence of an association between AD and Vietnam footwear diversification on volume as illustrate in Table 4.13 as well as price of non-AD footwear intable 4.14.Results, demonstrated in table 4.13, are similar to table 4.12. The figure points out general trend of India are adjacent to Vietnam footwear while Indonesia and Thailand are convincing higher before 2001, the timeline of BTA.
For instance, governments can sign a bilateral agreement with main partners to restrict using of antidumping. Looking into the “named” categories products, we can see that products have better growth rates were imposed tax while the others were not. When an AD occurs, Foreign government should give policies to encourage their firms diversify products to avoid AD.
Thus, EU AD is not only story of targeted countries but also story of countries which import similar products to host country of AD. This is important since it suggests that protectionist trade policy in one end market could pressure other end markets to enact similar policies.
In general, although there are several limitations, this research is still expected to contribute extremely to collection of empirical studies related to impact of antidumping Duties on angles of trade and economics. Journal of International Economics, 38(3), 321-337. The growth of world trade: tariffs, transport costs, and income similarity. Wages, profits, and rent-sharing. 8398): National Bureau of Economic Research. 2 (Egger Investigate effect of Data is published by OLS regression relies Effects of AD on world trade. & antidumping on effect on IMF over period 1948- on gravity model and volume and welfare are very little. welfare 2001 at country level;. including GDP, bilateral trade export volumes. However, authors argue that this result should not be seen as reason to consider or neglect AD. 2006) Investigate the east Asian’s problems with AD.
5 (Prusa, Impact of AD on Foreign US data is employed, the Compare results of (1) When countries used AD as 2003) export, and Home case of AD, year of panel fixed effects protection solution, it is difficult to. Data at 8- digit of Harm onize d Syste m (HS) of indus. r fix ed effe ct estimat ion. Impor t sha re of tar get edcou ntri es fall. ear if fixe d esti mat. ion is em plo ye d. When author uses system- gmm, it is. difference-gmm , system-gmm and fixed effects for robustness result. Pollard, Estimate effect antidumping duties 1996) import. evidence of difference behavior between named countries non-named countries through several of AD. 1996) Explore effectiveness usage of AD in case United States.