I do remember that period and in addition to Japanese automakers lowering the price of their cars, U.S. car makers raised the price of theirs, desiring to make more profit per car than retake market share.
My question focuses a bit more on the U.S. side and whether the trade deficits and job loss reflect a significant U.S. industrial decline. Is it possible that the trade deficit just reflects a growth in demand for goods that U.S. manufacturing is unable to meet because of limited capacity and the decline in jobs jsut represents a rise in productivity? In other words how should we evalute the strength and capacity of U.S. manufacturing in the face of the huge and growing trade deficits and long term decline in manufacturing employment? Marty Quoting michael <[EMAIL PROTECTED]>: > Marty, there is a literature about beachhead effects. When the > dollar > started to sink last time, the Japanese lowered their prices of > items, such > as cars, because of the difficulty of gaining reentry once they > allowed > themselves to be displaced. Of course, it the good is made by an > affiliate > of a company, this factor would not affect the situation. >
