Comments on `trade policies in the U.S. automobile industry", by Penny Koujianou Goldberg

Abstract

This is a paper on an important and timely topic and it represents a substantial improvement over much of the existing literature on the effects of trade policy in the U.S. automobile market. In particular, the use of consumer level data provided by the Consumer Expenditure Survey (CES) is a clever and useful approach to a problem frequently plagued by too little data. It is apparent that a great deal of time and effort have gone into this project.When I first discussed this paper, I noted that I was troubled by four issues. These were the estimation of demand elasticities, consumer welfare, the treatment of direct foreign investment by Japanese firms, and the modelling of the North American Free Trade Agreement (NAFTA). I am still concerned by these issues, and I will discuss them in turn.