South Korea: Temporary Trade Barriers Before and During the Crisis

Abstract

This paper examines Korea’s use of temporary trade barriers, mainly antidumping measures, before and during the global financial crisis of 2008-9. Using the Temporary Trade Barriers Database (Bown 2010b), we determined that the stock of imported products subject to antidumping duties in Korea has increased moderately over time. During the financial crisis of 2008-9, there were a relatively small number of initiations; however, we conclude that the Korea Trade Commission was active in imposing AD duties during the financial crisis. We also conclude that AD measures have functioned as a substitute for tariff protection measures in Korea during this period and that the Korean use of AD measures is consistent with the theory put forth by Grossman and Helpman (1994) that politically organized sectors tended to receive more protection than unorganized ones. In addition, our analysis of the practical use of Korea’s determinants of dumping margins suggests that the KTC has more frequently used ‘facts available’ than any other discretionary practices during the global financial crisis.