タイトル：Temporary protection and technology adoption: a study of U.S. motorcycle industry
Under the umbrella of temporary protection from 1983-1987, Harley-Davidson, a sole U.S. motorcycle manufacturer, introduced new engine named Evolution that bridged quality gap with its foreign rivals. Along with the gradual adoption of new engine to its models of motorcycles, Harley got back its sales from the bottom at the beginning of the periods of protection; therefore, the case is sometimes referred as an evidence to support the validity of protectionist argument. This paper examines the U.S. motorcycle market to assess the effectiveness of temporary protection policy as an inducement of technology adoption. This paper employs a structural econometric model of oligopoly pricing with differentiated products and the adoption of new engine to the models of motorcycles. In the model of technology adoption, I take account of the effect of learning-by-doing that is known to play an important role at the earlier stages of technology adoption. In the presence of learning-by-doing, temporary protection may serve a useful function to move up the learning curve. Based on the estimates of the model, I implement the counter-factual simulations to measure the effect of temporary protection on technology adoption. Simulation results reveal that the policy played only a minor role in promoting the technology adoption despite the presence of learning-by-doing.