U.S. Trade-Remedy Laws: Do They Facilitate or Hinder Free Trade?

N INCREASiNGLY contentious issue in international trade pertains to so-called “traderemedy laws.” These laws are intended to remedy hardships for U.S. firms resulting from the actions and policies of foreign firms and governments. Allegedly, these laws produce a “fair” and “free” trading environment. The possibility exists, however, that the concept of fair trade is simply a pretext used by interest groups to pursue their own interests at the expense of the national interest. This can result in a protectionist trading environment, which lowers economic well-being in the United States, rather than a fair and free one. This paper provides an inti’oduction to U.S. trade-remedy laws. As background to understanding the justification and effects of these laws, the concepts of fair trade, free trade and protectionism are described. Next, an overview of the primary laws is provided. This is followed by evidence on the increasing use of traderemedy laws. Finally, evidence on the administration and effects of these laws is examined to assess competing claims that these laws facilitate or hinder free trade.