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ANALYSIS OF CHANGES IN MARGINS OF DUMPING

TABLE OF CONTENTS

1. Background
2. Data Source
3. Results
4. Summary

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PUBLIC

CANADIAN INTERNATIONAL TRADE TRIBUNAL
Staff Report
ANALYSIS OF CHANGES IN MARGINS OF DUMPING
Research Team

Shiu-Yeu Li Lead Researcher
Shawn Jeffrey Statistician

Lise Lacombe Statistician

Approved by: _________________

R.W. Erdmann
Executive Director

Date: July 31, 2000

1. Background

The Tribunal's Bench and Bar Committee asked Tribunal staff to analyse the changes in margins of dumping that occur between the Preliminary (PD) and Final Determinations (FD) of CCRA. The purpose of the analysis was to answer 3 questions:

1. How likely was it that the PD margins changed at the FD?
2. How large were the changes and in which direction did they move?
3. Has there been an increasing or decreasing likelihood of change over time?

2. Data Source

In order to do this analysis, Tribunal staff collected and analysed CCRA/Revenue data on PD and FD margins from 1985¹ through 2000 by case and country. This data was derived from a CCRA website². The basic data is tabulated by case and by country in Table 1. This information is aggregated and summarised in Table 2.

Staff focused only on anti-dumping cases because the margins are expressed in common units (percentage of normal value), whereas subsidy estimates are not comparable across cases. Staff also eliminated cases that did not result in CIT/CITT injury inquiries.

3. Results

For the entire period, the summary statistics show that the differences in margins between PD and FD were:

Summary Statistics
(1985 - 2000)

Percentage
Points( PP)

Average:

-1.8

Median (middle value, with equal number of observations either smaller or larger):

-0.5

Mode (value that occurred most frequently):

0.0

These results suggest that the `typical' dumping investigation has resulted in relatively small changes in margins at the CCRA final determination.

Nevertheless, there are some instances of larger changes. To get a better sense of their relative importance, staff prepared a bar chart of the frequency (or probability) of changes, by magnitude of the change (Figure 1). This figure shows the results in the following table:

Change (PP)

Percentage of Cases
(1985 - 2000)

0-5
69

5-25
29

> 25
2

These results suggest again that most changes are relatively small.

To see the results over time, staff prepared a chart, plotting the changes in margins, between PD and FD, by year (Figure 2). This chart is in the form of a "bubble graph" in which the diameter of each data point is proportional to the number of observations with that size of change. Again, this chart indicates a predominance of results close to no change, with a lesser number of larger changes.

Finally, to see if the size or direction of changes in margins has been changing over time, staff performed two types of analysis.

First, staff looked at a simple time trend analysis of the results. It shows (Figure 3) that the average reductions in margins, between PD and FD, have been increasing over the 15-year period by about 0.3 pp per year. It should be noted, however, that this trend is neither large nor significant, in light of the wide range of values observed over the years³.

Second, staff compared the results across three separate time periods: 1985-89, 1990-94 and 1995-2000 (Figure 4). The results of this analysis are summarised in the following table:

Change (PP)

Percentage of Cases

1985-89

1990-94

1995-2000

0-5

68 68 71

5-25

28 31 26

> 25

4 1 3

These results suggest again that the likelihood of large changes in margins has been falling somewhat over time.

4. Summary

- On balance, the differences between the margins of dumping between PD and FD were relatively small.
- While the margins of dumping as determined at the PD, on average, tended to decline somewhat at the FD, and the magnitude of these declines were observed to be increasing slightly over this period, this trend is far from conspicuous.
- Over this period, the likelihood of large changes in margins of dumping has been falling somewhat.