The Byrd Amendment as Facilitating a Tacit International Business Collusion

17 Pages Posted: 18 Oct 2011

See all articles by Yoshitomo Ogawa

Yoshitomo Ogawa

Kinki University

Yoshiyasu Ono

Osaka University - Institute of Social and Economic Research (ISER)

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Date Written: November 2011

Abstract

This paper analyzes the effect of the Byrd Amendment, which amended the US Tariff Act of 1930 to allow revenues from antidumping duties to be distributed to domestic import‐competing firms. In an international oligopoly framework it is shown that it urges the home firm to restrict output so that the foreign firm increases output and pays more duties. Consequently, not only the home firm but also the foreign firm is better off while only consumers are worse off. Home total surplus also increases under this policy especially when the home firm is very inefficient.

Suggested Citation

Ogawa, Yoshitomo and Ono, Yoshiyasu, The Byrd Amendment as Facilitating a Tacit International Business Collusion (November 2011). Review of International Economics, Vol. 19, Issue 5, pp. 877-893, 2011. Available at SSRN: https://ssrn.com/abstract=1945590 or http://dx.doi.org/10.1111/j.1467-9396.2011.00992.x

Yoshitomo Ogawa (Contact Author)

Kinki University ( email )

Higashi-Osaka City, Osaka 577-8502
Japan

Yoshiyasu Ono

Osaka University - Institute of Social and Economic Research (ISER) ( email )

6-1 Mihogaoka
Ibaraki, Osaka 567-0047
Japan

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