The Byrd Amendment as Facilitating a Tacit International Business Collusion

Yoshitomo Ogawa and Yoshiyasu Ono

ISER Discussion Paper from Institute of Social and Economic Research, The University of Osaka

Abstract: We analyze the effect of the Byrd Amendment, which amended the US Tariff Act of 1930 to allow revenue from antidumping duties to be distributed to domestic import-competing firms. In an international duopoly framework it is shown that it urges the home firm to restrict output so that the foreign firm increases output and that revenue from the duties increases. Consequently, not only the home firm but also the foreign firm can be better off while only consumers are worse off. Home total surplus increases if the foreign rival firm is much more efficient, but otherwise decreases.

Date: 2006-01
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Journal Article: The Byrd Amendment as Facilitating a Tacit International Business Collusion (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:dpr:wpaper:0647

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