The protectionists seek government action that would compel Japanese automakers to purchase more of their products, and the issue is under investigation by the U.S. International Trade Commission. This report investigates these complaints of unfair competi- tion and discusses the economic impact of increased international competition in the auto parts industry. It shows that the com- plaints of discrimination against American companies are untrue.
Japanese manufacturers do business with hundreds of American parts suppliers.
The increased competition provided by Japanese auto parts manufacturers provides significant benefits to the auto industry and workers and to consumers. Consequently, any legislative action that restricted such competition would have harmful effects on the economy. As with all protectionist legislation, such actions would provide short-lived benefits to a small segment of the auto parts industry but would be harmful to the industry in the long run by reducing its incentives to produce better products. To view this entire document please click here .