The Impact of Antidumping on the R&D of Export Firms: Evidence from China

ABSTRACT

The micro-influence of antidumping (AD) trade barriers has been given more attention lately, but the influence of AD barriers on the research and development (R&D) of export firms has not yet been studied empirically. In this study, we use firm-level data from China and difference-in-difference and Tobit models to examine the responses of export firms’ R&D activities to AD barriers. The results show that AD barriers significantly reduce firms’ R&D investment and R&D intensity, in particular, R&D investment among general export firms, high-tech firms, and single-product firms. While ordinary trade firms and high-tech firms are more R&D intensive, larger-scale export firms generally have higher productivity. Therefore, AD barriers have a significant effect on firms’ innovation, long-term productivity improvement, and allocation of R&D resources. We also examined the impact mechanism from the perspective of financial constraints.

KEYWORDS:

• Antidumping
• firms’ r&d
• difference-in-differences model
• tobit model

Acknowledgments

We are grateful to referees for their helpful comments and suggestions.

Notes

1. International Convention for Harmonized Commodity Description and Coding System, short for Harmonized System or HS. HS4 means HS 4-digit code.

2. As firms can operate under multiple trade modes, we classified firms as either processing trade firms or ordinary trade firms based on the trade regime that accounted for the larger proportion of their exports.

3. High-tech industries include drugs and medicines, office and computing equipment, communications equipment, electronics components, industrial measuring instruments, and surgical instruments. These industries are also typically capital-intensive industries.

Additional information

Funding

Xie thanks to the financial support from the National Social Science Foundation of China [Grant No. 18AGJ001] and Taishan Younger Scholar special fund. Liu thanks the financial support from The Construction of CHINA TOP THINK TANKS [Grant No. 20155010298].