Voluntary Export Restraints on Automobiles: Evaluating a Strategic Trade Policy

Steven Berry (), J. Linsohn and Ariel Pakes

Working Papers from Research Seminar in International Economics, University of Michigan

Abstract: In May, 1981, a voluntary export restraint (VER) was placed on exports of automobiles from Japan to the United States. As trade policies go, this one was important. The automobile industry is the largest manufacturing industry in the United States and the initiation of the VER captured head- lines in the popular press. At about the same time, though to much less fanfare, international trade theorists were obtaining (then) startling results from models of international trade in imperfectly competitive markets. These models suggested that in imperfectly competitive markets, an activist trade policy might enhance national welfare. In this paper, we provide some empirical evidence on whether the these new theoretical possibilities might actually apply to the policy of VERs

Keywords: INTERNATIONAL TRADE; AUTOMOBILE INDUSTRY (search for similar items in EconPapers)
JEL-codes: F10 F14 L62 (search for similar items in EconPapers)
Pages: 37 pages
Date: 1997
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Citations: View citations in EconPapers (1)

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Working Paper: Voluntary Export Restraints on Automobiles: Evaluating a Strategic TradePolicy (1995)
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Persistent link: https://EconPapers.repec.org/RePEc:mie:wpaper:393

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