Japanese and Korean Automobile Exports and the Alchian-Allen Theorem

Pramesti Resiandini ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper compares data on Japanese and Korean automobile exports to the United States to examine consistency with the Alchian-Allen theorem. The theorem suggests that imposing a per unit charge such as transport cost will lower the relative price and increase the relative consumption of higher quality cars. Results show that the relative price of higher-quality cars is not necessarily lower with increased shipping costs, measured by CIF charges (cost, insurance, and freight). A possible explanation is that insurance and other shipping charges are imposed based on the car price, and these charges reduce or eliminate the Alchian-Allen effect of per-unit freight charge.

Keywords: International Trade; Transport Costs; Alchian-Allen Theorem; Dynamic OLS (search for similar items in EconPapers)
JEL-codes: F14 (search for similar items in EconPapers)
Date: 2012-07
New Economics Papers: this item is included in nep-int and nep-tre
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https://mpra.ub.uni-muenchen.de/41928/1/MPRA_paper_41928.pdf original version (application/pdf)

Related works:
Journal Article: Japanese and Korean automobile exports and the Alchian-Allen theorem (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:41928

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