The Analysis of Causality in Escape Clause Cases

Abstract

Under Section 201 of the Trade Act of 1974, the so-called escape clause, a domestic industry that is seriously injured can obtain temporary relief if imports are the substantial cause of such injury. This paper develops a methodology to determine the change in a domestic industry's production as a result of changes in import supply, demand, and domestic supply, and so determine whether or not an industry is entitled to Section 201 relief. This methodology is illustrated by application to two recent Section 201 investigations-wood shakes and shingles, and nonrubber footwear. Copyright 1988 by Blackwell Publishing Ltd.