What Is Dumping? Distinguish Between Predatory and Unintentional Dumping

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The Answer is Dumping refers to the practice of selling goods in a foreign market at a price that is lower than the cost of production or lower than the price charged in the domestic market. This can harm domestic industries by undercutting their prices and making it difficult for them to compete.

Predatory dumping occurs when a company intentionally sells goods in a foreign market at a price below the cost of production in order to drive competitors out of the market. This can lead to monopolistic control of the market and harm consumers by reducing competition.

Unintentional dumping, on the other hand, occurs when a company sells goods in a foreign market at a lower price due to factors such as currency fluctuations, changes in demand, or excess production capacity. While unintentional dumping may still harm domestic industries, it is not done with the intention of driving competitors out of the market.

In both cases, dumping can lead to trade disputes and retaliatory measures by affected countries in order to protect their domestic industries. It is important for governments to monitor and address instances of dumping in order to ensure fair competition in the global market.

What Is Dumping? Distinguish Between Predatory and Unintentional Dumping

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