Trade Circumvention in China's Anti‐Dumping Measures Against the U.S.

ABSTRACT This paper investigates whether and how U.S. exporters circumvent China's anti‐dumping (AD) measures by re‐routing trade through third countries. Using detailed data on AD cases and monthly trade flows of China and U.S. from 2002 to 2011, we apply a triple‐differences (DDD) approach to identify abnormal trade‐flow adjustments consistent with third‐country re‐routing. We find evidence of such patterns in a subset of cases following final AD rulings. Product characteristics, such as lower differentiation, higher financial leverage, and greater inventory pressure, are associated with variation in the feasibility and intensity of circumvention. Moreover, circumvention tends to occur through countries that are institutionally closer to the U.S. and geographically concentrated in Asia‐Oceania routes. The possible circumvention emerges after final rulings rather than during investigations.