then jacked up prices. Instead, foreign producers typically continue competing hard against each other and

providing low prices to consumers. In short, it is difficult to find evidence of predatory pricing by foreign firms

exporting to the United States.

Even if one could make a case that the government should sometimes enact anti-dumping rules in the short

term, and then allow free trade to resume shortly thereafter, there is a growing concern that anti-dumping

investigations often involve more politics than careful analysis. The U.S. Commerce Department is charged

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20.3 • Arguments in Support of Restricting Imports 485

with calculating the appropriate “cost of production,” which can be as much an art as a science.

For example, if a company built a new factory two years ago, should it count part of the factory’s cost in this

year’s cost of production? When a company is in a country where the government controls prices, like China
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