¹ / Attached to the original report sent to the President, and availablefor inspection at the U.S. International Trade Commission, except for material submitted in confidence.

² / This affirmative determination of Chairman Minchew and CommissionersLeonard and Moore covers, among other articles, “complete” and “incomplete television receivers as defined in the “Findings and Recommendations”section immediately below.

² / The terms “complete” and “incomplete” are defined in the “Findings andRecommendations” section immediately below.

¹ / As used in these views, the term “import relief” includes importrestraints as well as adjustment assistance unless the context indicates otherwise.

¹ / The issue of what is the proper domestic industry to examine undersec. 201 has been explored in previous cases. Stainless Steel and AlloyTool Steel: Report to the President on Investigation No. TA-201-5 …, USITC Publication 756, 1976, pp. 15-18.

¹ / For a further consideration of the legislative history and tneaningof this criterion, see Birch Plywood Door Skins: Report to thePresident on Investigation No. TA-201-1 …, USITC Publication 743,1975, pp. 9-12; and Stainless Steel and Alloy Tool Steel: Report to the President on Investigation No. TA-201-5 …, USITC Publication756, 1976, pp. 19-22, 38-42.

¹ / The principal difference between U.S. Department of Commercestatistics and those collected by the Commission is that the former did not separately provide for unfinished or incomplete receivers untilJuly 1, 1976.

² / These ratios indicate that irrespective of how imports of incompletesets are counted, i.e., as imports or as part of domestic production,there has been a significant increase in imports in relation to domesticproduction. The Commission did not collect data on imports of completeand incomplete receivers for the years 1968-70; however, it is believedthat imports of incomplete receivers were insignificant in those years.

¹ / For a further discussion of the criterion of serious injury or threat thereof, see Bolts, Nuts, and Screws of Iron or Steel: Reportto the President on Investigation No. TA-201-2 …, USITC Publication747, 1975, pp. 5-8.

¹ / Capacity is the potential output of U.S. television receiver assemblyplants if they were operated one shift a day, 5 days a week, with nochanges in product mix from that actually produced during the period forwhich data were provided.

¹ / Twelve firms reported profit-and-loss information to the Commissionin 1974, whereas only 11 firms were able to report usable data in 1975and January-September 1976.

¹ / Trade Reform Act of 1974: Report of the Committee on Finance …,S. Rept. No. 93-1298 (93d Cong., 2d sess.), 1974, pp. 120-121. Forfurther discussion of this criterion, see Stainless Steel and Alloy ToolSteel: Report to the President on Investigation No. TA-201-5 ....USITC Publication 756, 1976, pp. 25-26, 45-46.

¹ / This price differential will vary substantially, up or down, depending upon the specific models selected and upon the particularimporters' pricing policies.

¹ / The following assumptions are the basis for the cited effects of the remedy we have found to be required. It is believed that total U.S.consumption of television receivers, monochrome and color, in 1977 willapproximately equal the 1976 level of 5.4 million monochrome units and8.9 million color units. Exports in 1977 are expected to hold at the1976 level of 185,000 and 168,000 units for monochrome and color receivers,respectively. Imports, absent any relief, are conservativelyestimated to approximate the levels reached in 1976. With a 25-percent tariff on imported television receivers, monochrome and color, importsof monochrome receivers would amount to approximately 3.9 mill’ion unitsin 1977, 600,000 units below the nearly’ 4.5 million receivers importedin 1976. Imports of color receivers would be about 2.5 million unitsin 1977, 400,000 units below the 2,9. million receivers imported in 1976.This decline in imports is based upon the assumption that one-half theduty increase is passed on to the consumer. The import-domestic priceelasticity of demand is assumed to be -1.40 for all television receivers(this estimate was presented in testimony before the Commission by theAmerican Retail Federation). Although this price elasticity of demanddid not meet all tests of statistical reliability, it is the only oneavailable to us for all television; receivers and was presented to theCommission by an association familiar with the industry. It is ourbelief that it is a reasonable estimate for all televisions. Anotherprice elasticity presented to the Commission was -.75; this figure wasfor all consumer durables rather than specifically for televisionreceivers and therefore was not used. If this price elasticity wasused, the demand for the imported receiver, given the same assumptionsas before, would yield a lesser decrease in imports and a smaller increase indomestic production, but would yield a correspondingly higher cost tothe consumer. Assuming no domestic price increase, a price elasticityof -1.40, and U.S. consumption in 1977 approximately equal to that of1976, all of the decline in imports of monochrome and color receivers,600,000 and 400,000 units, respectively, would be the amount of increasedproduction in the domestic industry because consumer demand could onlybe satisfied by the domestic producer. Thus, domestic television productionwould be about 1 million units greater than it would be were noremedy provided. The average annual output of all television receiversis estimated at about 220 units per worker. Therefore, approximately2,709 more monochrome and 1,809 more color workers would be employedthan there would be in the absence of a remedy.

¹ /Testimony of the Council on Wage and Price Stability at the Commission'shearing in Washington, D.C., on January 18, 1977, p. 554 of thetranscript.

² / Testimony of Stanley Nehmer at the Commission's hearing in Washington,D.C., on Jan. 19, 1977, pp. 951-52 of the transcript.

¹ /The case presented makes the following assumptions: (1) 50 percent of the du*y increase is passed through to the consumer; (2) there existsa 75-percent markup in the price of the average receiver from dutiablevalue plus tariff to the retail price; (3) the price elasticity of demand for all receivers is -1.4Q;and (4) there is no price increase in the domesticproduct. See also text on pages 22 and 23, and footnote on page 24. The assumption:in the text concerning expanding domestic production without the need toincrease prices is supported by the substantial unused capacity presentin the domestic industry.

¹ / Retaliation or compensation is permitted under the General Agreementon Tariffs and Trade, to which the United States and virtually all supplying countries are contracting parties. The Republic of China is not acontracting party; however, it could unilaterally impose restrictions onU.S. exports to that country in the absence of compensation.

² / Several of the principal exports of Taiwan and Korea are duty freeunder the Generalized System of Preferences. Such items are not includedin the list of leading imports.

¹ / Filed by the Industrial Union Department, AFL-CIO; Allied Industrial Workers'of America, International Union; American Flint Glass Workers Union of NorthAmerica; Communications Workers of America; Glass Bottle Blowers' Associationof the United States & Canada; Independent Radionic Workers of America;International Association of Machinists; International Brotherhood of ElectricalWorkers; International Union of Electrical, Radio & Machine Workers; UnitedFurniture Workers of America; United Steelworkers of America; Corning Glass Works;GTE Sylvania Inc.; Owens-Illinois Inc.; Sprague Electric Co.; and Wells-GardnerElectronics, Inc.

¹ / Trade Reform Act of 1974: Report of the Committee on Finance …,S. Rept. No. 93-1298 (93d Cong., 2d sess.), 1974, p. 119-120.

¹ / Mushrooms: Report to the President on Investigation No. tA-201-17 …,USTTC Publication 798, 1977, P. 24.

¹ / GATT Doc. Sr. 15/17, 1951, at p. 153:

² /See J. H. Jackson, World Trade and the Law of GATT, 1969, pp. 570-573.

³ / See Trade Reform Act of T974: Report of the Committee on Finance …,S.Rept. No. 93-1298 (93d Cong., 2d sess/), 1974, pp. 210-213.

⁴ / Delbert A. Snider, Introduction to International Economics, 1971Richard D. Irwin, Inc., Homewood, 111., p. 157.

¹ / Jan Tumlir, In SearcTi of a New WorTdTconomic Order, Hugh Corbet andRobert Jackson, editors, John Wiley & Sons, New York, 19/4, p. 260. ]/ The Commission should keep under review any increase in domesticprices as a result of any import relief action which may be taken, and ifundue prices increases result, appropriate action under sec. 203(h)(4)should be considered.

^* [Reproduced from the Weekly Compilation of Presidential Documents,Volume 13, Number 21 (May 23, 1977), pp. 761-62.]