Multiproduct Firms and Dumping

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Abstract

In this paper, we first develop a model of an international oligopolistic Cournot industry in which firms trade core goods and their incompatible accessories. We then examine some issues concerned with dumping. We find that such finns set the core goods price below cost (below-cost dumping, henceforth) even under perfect competition. We also find that firms might simultaneously engage in both price-discriminating dumping in the market for accessories and below-cost dumping in the market for core goods. Furthermore, we demonstrate that antidumping tariffs on both core goods and accessories may expand the dumping margin in the accessories market.

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