Justin R. Pierce (U.S. Bureau of the Census)

Abstract


This paper describes the effects of a temporary increase in tariffs on the performance and behavior of U.S. manufacturers. Using antidumping duties as an example of temporaryprotection, I compare the responses of protected manufacturers to those predicted by models of trade with heterogeneous firms. I find that apparent increases in revenue productivity associatedwith antidumping duties are primarily due to increases in prices and mark-ups, as physical productivity falls among protected plants. Moreover, antidumping duties slow the reallocation of resources from less productive to more productive uses by reducing product-switching behavior among protected plants.