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Implementing Results-Oriented Trade Policies: The Case of the US-Japanese Auto Parts Dispute

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  • Kala Krishna
  • John Morgan

Abstract

Why would the US threaten punitive tariffs on luxury autos to implement a market share target in auto parts? We show that by making threats to a linked market, a market share may be implemented with fairly weak informa- tional and administrative requirements. Moreover, such policies can be both pro-competitive and advatageous to US firms.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 5680.

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Date of creation: Jul 1996
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Publication status: published as European Economic Review, Vol.42, no.8 (October 1998): 1443-1467.
Handle: RePEc:nbr:nberwo:5680

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References

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  1. Levinsohn, J., 1996. "Carwars: Trying to Make Sense of U.S.-Japan Trade Frictions in the Automobile and Automobile Parts Markets," Working Papers, Research Seminar in International Economics, University of Michigan 389, Research Seminar in International Economics, University of Michigan.
  2. Krishna, Kala, 1989. "Trade restrictions as facilitating practices," Journal of International Economics, Elsevier, Elsevier, vol. 26(3-4), pages 251-270, May.
  3. Greaney, Theresa M., 1996. "Import now! An analysis of market-share voluntary import expansions (VIEs)," Journal of International Economics, Elsevier, Elsevier, vol. 40(1-2), pages 149-163, February.
  4. Kala Krishna & Suddhasatwa Roy & Marie Thursby, 1996. "Implementing Market Access," NBER Working Papers 5593, National Bureau of Economic Research, Inc.
  5. Spencer, Barbara J & Jones, Ronald W, 1991. "Vertical Foreclosure and International Trade Policy," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 58(1), pages 153-70, January.
  6. Carmichael, Calum M., 1987. "The control of export credit subsidies and its welfare consequences," Journal of International Economics, Elsevier, Elsevier, vol. 23(1-2), pages 1-19, August.
  7. Greaney, T., 1993. "Import Now! An Analysis of Voluntary Import Expansions (VIEs) to Increase U.S. Market Shares in Japan," Working Papers, Research Seminar in International Economics, University of Michigan 343, Research Seminar in International Economics, University of Michigan.
  8. Jonathan Eaton & Gene M. Grossman, 1983. "Optimal Trade and Industrial Policy Under Oligopoly," NBER Working Papers 1236, National Bureau of Economic Research, Inc.
  9. James A. Brander & Barbara J. Spencer, 1984. "Export Subsidies and International Market Share Rivalry," NBER Working Papers 1464, National Bureau of Economic Research, Inc.
  10. Reitzes, James D. & Grawe, Oliver R., 1994. "Market-share quotas," Journal of International Economics, Elsevier, Elsevier, vol. 36(3-4), pages 431-447, May.
  11. Gruenspecht, Howard K., 1988. "Export subsidies for differentiated products," Journal of International Economics, Elsevier, Elsevier, vol. 24(3-4), pages 331-344, May.
  12. repec:fth:michin:389 is not listed on IDEAS
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Cited by:
  1. Qiu, Larry D. & Spencer, Barbara J., 2002. "Keiretsu and relationship-specific investment: implications for market-opening trade policy," Journal of International Economics, Elsevier, Elsevier, vol. 58(1), pages 49-79, October.
  2. Kala Krishna & Suddhasatwa Roy & Marie Thursby, 1997. "Procompetitive Market Access," NBER Working Papers 6184, National Bureau of Economic Research, Inc.
  3. Chen, Yongmin & Ishikawa, Jota & Yu, Zhihao, 2001. "Trade Liberalization and Strategic Outsourcing," Discussion Papers 2001-04, Graduate School of Economics, Hitotsubashi University.
  4. Krishna, K. & Roy, S. & Thursby, M., 1998. "Can Subsidies for MARs be Procompetitive," Papers, Purdue University, Krannert School of Management - Center for International Business Education and Research (CIBER) 98-008, Purdue University, Krannert School of Management - Center for International Business Education and Research (CIBER).
  5. Barbara J. Spencer & Larry D. Qiu, 2000. "Keiretsu and Relationship-Specific Investment: A Barrier to Trade?," NBER Working Papers 7572, National Bureau of Economic Research, Inc.

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