Subsidizing rent-seeking: Antidumping protection and the Byrd Amendment

Corporate Lobbying in Antidumping Cases: Looking into the Continued Dumping and Subsidy Offset Act

“…First, we show that lobbying matters when government support is directly involved (Reynolds, 2006). We further show that although lobbying is effective in acquiring greater proceeds from the government under the CDSOA, claiming Statistical significance: <10%; *<5%; **<1%; ***<0.1%.…”

“…Seung-Hyun Lee and Yoon-Suk Baik that the firms that lobby get protection, but not necessarily the healthy ones (Gayle and Puttitanun, 2009;Reynolds, 2006). Our research has implications for scholars interested in corporate political strategies, which may include non-market strategies, such as lobbying from the grabbing-hand perspective (Shleifer and Vishny, 1998).…”

“…Along with this trend, government regulations have also evolved. An important regulatory change related to antidumping is the Continued Dumping and Subsidy Offset Act (CDSOA) in 2000 (Gayle and Puttitanun, 2009;Jung and Lee, 2003;Reynolds, 2006). An essential part of this act is to distribute funds raised from antidumping duties to the U.S. companies that filed antidumping complaints.…”

The Empirical Measurement of Rent-Seeking Costs

“…The paper of Liebman and Reynolds (2006) is a fine one that contains solid research, although the case study is very idiosyncratic. Reynolds (2006) extended the analysis of the Byrd Amendment, studying whether it has mitigated the free rider problem that arises in an industry's attempt to lobby for trade protection, finding empirical support for her hypothesis. The paper by Wise and Sandler (1994) constitutes a related study in which they sought to empirically relate potential rents to rent‐seeking effort, although their central aim was to estimate a theoretical model with endogenous determination of rents (Appelbaum and Katz, 1987).…”

“…However, the effect of corruption on growth is a topic that has exceeded the scope of public choice and has been incorporated as a subject in the field of economic growth. In the last category (iv), it would be desirable to see more work along the lines of Liebman and Reynolds (2006) and Reynolds (2006), who used another natural experiment to assess the connection between the expected firm‐level returns from anti‐dumping compensation and firm‐level campaign contributions, although it has to be admitted that opportunities like the Byrd Amendment are scarce. The microeconomic analysis of the effects of rent seeking on efficiency could also be another route to which future research may be redirected.…”