Voluntary Export Restraints on Automobiles: Evaluating a Strategic Tradepolicy

57 Pages Posted: 11 Jun 2000 Last revised: 20 Nov 2000

See all articles by Steven Berry

Steven Berry

Yale University - Department of Economics; National Bureau of Economic Research (NBER); Yale University - Cowles Foundation

James A. Levinsohn

University of Michigan; National Bureau of Economic Research (NBER)

Ariel Pakes

National Bureau of Economic Research (NBER); Harvard University - Department of Economics

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Date Written: August 1995

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. 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 these new theoretical possibilities might actually apply to the policy of VERs.

Suggested Citation

Berry, Steven T. and Levinsohn, James A. and Pakes, Ariel, Voluntary Export Restraints on Automobiles: Evaluating a Strategic Tradepolicy (August 1995). NBER Working Paper No. w5235. Available at SSRN: https://ssrn.com/abstract=225299

Steven T. Berry (Contact Author)

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Ariel Pakes

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