Other monetary policies that can affect the automotive industry in the U.S. include mandated price ceilings on the price of gasoline (Mankiw, 2004). These approaches, though, have not proven particularly effective in the past and created more problems than they solved. In this regard, this author also emphasizes that, "Eventually, the laws regulating the price of gasoline were repealed. Lawmakers came to understand that they were partly responsible for the many hours Americans lost waiting in line to buy gasoline. Today, when the price of crude oil changes, the price of gasoline can adjust to bring supply and demand into equilibrium" (Mankiw, p. 117).

Finally, U.S. foreign policy initiatives that use import tariffs and isolationist policies can increase the cost of the raw materials used by the automotive industry in ways that can also have a profound effect on their ability to remain competitive and profitable. According to Carlos Ghosn,...
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