Australian Government Policies and the Balance of Trade Performance of the Transportation Equipment Industry: A Comparative Perspective

Abstract

This paper investigates factors that have affected the trade balance of the Australian motor vehicle industry and considers the impact of Australian government policies to encourage the development of that industry. It presents an overview of the industry, discusses the history of government policies to promote both manufacturing and exports of motor vehicle products, and provides a comparison of Australia with other developing producers of motor vehicles. A linear regression model is employed to examine the impact of government policies on net exports, and the results are compared with experiences of countries with similar motor vehicle sectors.