U.s. Imposes Tariffs On Chinese Solar Panels

730 Words3 Pages
This article discusses how the U.S. imposes tariffs on Chinese solar-panels due to the fact that China was ‘dumping’ solar-panels to the U.S market, it also considers the possible impact of these changes and attempts to assess the relative merits/drawbacks of the policy. Dumping is the selling of goods and services on foreign markets below their cost of production[ http://study.com/academy/lesson/dumping-in-economics-definition-effects.html]. A tariff is defined as taxation on imported goods.

Dumping of Chinese solar-panels on the U.S market

Chinese companies were ‘selling products below the cost of manufacture also benefiting from unfair subsidies from their government’ this results the domestic quantity supply of solar-panels to decrease as the price of domestic supplied solar-panels is higher than ones imported from China. But U.S consumers are paying a lower price when solar-panels are exported to the U.S from China and consumers get more variety of choices when buying. Even if America’s solar market contained no trade-barriers before this, the domestic quantity supplied would still decrease from Q2 to Q1 because most domestic solar companies cannot compete with the subsidized Chinese producers. ‘Inexpensive Chinese solar-products pushed many American manufacturers out of business’, causing structural-unemployment in America and this will be difficult for the U.S government to deal with because this will require retraining or other initiatives which can sometimes be
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