The trade effects associated with an antidumping epidemic: The hot-rolled steel market, 1996-2001

Between 1996 and 2001 hot-rolled steel was subject to numerous antidumping (AD) complaints. Because it is a relatively homogenous product that nearly all steel firms can produce, hot-rolled steel is an ideal case study for examining whether AD-induced trade effects - trade diversion and trade deflection - explain why the hot-rolled steel cases were not a typical trade spat, but rather an AD outbreak of historic proportion. We create a detailed database of bilateral trade at the six-digit HS level and find strong evidence of trade destruction, somewhat weaker evidence of trade deflection, and little evidence of trade diversion. These results make it unlikely that the country-specific nature of AD protection has anything to do with the emergence of the hot-rolled AD epidemic.