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European anti-dumping policy: Welfare implications for German consumers of Solar Glass

Kosovich, Aaron (2014) European anti-dumping policy: Welfare implications for German consumers of Solar Glass. Honours thesis, Murdoch University.

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On the 26th of November 2013 the European Commission concluded that solar glass origi- nating from the People’s Republic of China had been dumped into the European market. The Commission imposed a provisional anti-dumping duty on subsequent imports. This thesis eval- uates the expected and actual welfare implications for consumers in the German market after the anti-dumping duty was introduced. As Europe’s largest solar energy producer, German data on solar energy production, sampled between 2011 and 2014, as well as price levels and installation rates for solar energy provides a robust framework of analysis. By way of a mul- tiple regression analysis, it is found that the introduction of the Commission’s anti-dumping duty had a statistically insignificant effect on the production of solar electricity in the German market. Through the continued growth in solar energy production, it is found that German consumers are inelastic to changes in the price of solar energy. Prior literature underlines the prevalence of consumption preferences for consumers who exhibit the ’warm-glow’ effect and derive utility out of altruism towards the environment. The heightened consumption of solar energy in spite of rising prices underlines this effect. These conclusions enable further consider- ation for the duty’s implications for market welfare in the country, and also its implications for the wider European community. It is concluded, in contrast with classical theory on industrial organisation, that European consumers were made no worse off as a result of the anti-dumping duty, and that producers benefited.

Publication Type: Thesis (Honours)
Murdoch Affiliation: School of Management and Governance
Supervisor: Brennan, Murray
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