Goksel, Turkmen (2011): Reputation and Learning: Japanese Car Exports to the United States.
Download (256Kb) | Preview
This paper incorporates learning and reputation building into a simple dynamic stochastic model of international trade with asymmetric information. We use the model to study a bilateral trade flow influenced significantly by learning and reputation, namely U.S. imports of Japanese cars over the period 1961-2005. Numerical simulations replicate the trade flow in a robust fashion. In addition to matching this event, we explore further implications of our framework for understanding international trade patterns. Since learning and reputation building require time, predicted short run trade patterns can be quite different than those predicted in the long run. Sectorial differences in the speed of learning and reputation building affect predicted trade patterns. The extent of asymmetric information existing between importers and exporters also changes under different trade policies.
|Item Type:||MPRA Paper|
|Original Title:||Reputation and Learning: Japanese Car Exports to the United States|
|Keywords:||international trade, reputation, learning, asymmetric information, automobile|
|Subjects:||F - International Economics > F1 - Trade > F10 - General|
|Depositing User:||turkmen goksel|
|Date Deposited:||22. Aug 2012 14:11|
|Last Modified:||15. Feb 2013 21:18|
Akerlof, G. A. (1970): “The Market for “Lemons”: Quality Uncertainty and the Market Mechanism,” Quarterly Journal of Economics, 84(3), 488–500. Bradsher, K. (2007): “Toyota Tops G.M. in Sales for First Time,” New York Times, p. April 24. Crandall, R. W., and C. Winston (2005): “Auto Industry on the Line,” Detroit Free Press, p. May 23. Falvey, R. E. (1989): “Trade, Quality Reputations and Commerical Policy,” International Economic Review, 30(3), 607–622. Gertner, J. (2007): “From 0 to 60 to World Domination,” New York Times, p. February 18. Gould, D. M. (1994): “Immigrant Links to the Home Country: Empirical Implications for U.S. Bilateral Trade Flows,” Review of Economics and Statistics, 76(2), 302–316. Greif, A. (1989): “Reputation and Coalitions in Medieval Trade: Evidence on the Maghribi Traders,” Journal of Economic History, 49(4), 857–882. Guiso, L., P. Sapienza, and L. Zingales (2009): “Cultural Biases in Economic Exchange?,” Quar- terly Journal of Economics, 124(3), 1095–1131. Holmstrom, B. (1999): “Managerial Incentive Problems: A Dynamic Perspective,” Review of Eco- nomic Studies, 66(1), 169–182. Mannering, F., and C. Winston (1991): “Brand Loyalty and the Decline of American Automobile Firms,” Brookings Papers on Economic Activity: Microeconomics, pp. 67–114. Melitz, M. J. (2003): “The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity,” Econometrica, 71(6), 1695–1725. Nieuwerburgh, S. V., and L. Veldkamp (2009): “Information Immobility and the Home Bias Puzzle,” Journal of Finance, 64(3), 1187–1215. Rauch, J. E., and V. Trindade (2002): “Ethnic Chinese Networks in International Trade,” Review of Economics and Statistics, 84(1), 116–130.
Shapiro, C. (1983): “Premiums for High Quality Products as Returns to Reputations,” Quarterly Journal of Economics, 98(4), 659–680. Spence, M. (1973): “Job Market Signaling,” Quarterly Journal of Economics, 87(3), 355–374. Tadelis, S. (1999): “What’s in a Name? Reputation as a Tradeable Asset,” American Economic Review, 89(3), 548–563. Train, K. E., and C. Winston (2007): “Vehicle Choice Behavior and the Declining Market Share of U.S. Automakers,” International Economic Review, 48(4), 1469–1496. Wojcik, C. (2001): “Learning by Consumers in the Demand for Japanese Cars,” Review of Interna- tional Economics, 9(1), 94–107.