Tariffs and the Byrd amendment

The Byrd amendment to US anti-dumping law distributes the revenue from anti-dumping duties imposed on foreign firms to the domestic firms that lodged the complaint of dumping. This paper shows that the presence of the Byrd Amendment can yield lower duties and greater welfare than in its absence. This result holds when the US government puts a sufficient weight on the profits of the domestic industry in the welfare function. A sufficient condition for this result is that the market share of the domestic industry exceeds 50%, which applies in most US antidumping cases.