“What is Dumping?”
- Essentially it is selling something for less than the cost of producing it
- This is used by dominant suppliers in an industry as a method of getting rid of competitors
- Countries often use dumping as an excuse to adopt protectionist measures by accusing other countries of dumping goods
Life Application/Analogy
If Rizzland starts selling mangoes to FunLand for less money than what they are worth in FunLand, then the mango producers in FunLand will have trouble selling their product in their domestic markets and eventually will run out of business. The goal of dumping is to gain a competitive advantage in a market
How do I remember it?
Think of the word dumping, how it basically means to get rid of, which is the basic idea, you are getting rid of a product for less value in order to gain a competitive advantage over competitors in the long run.
Follow us on TikTok, Instagram, and Youtube below
