タイトル：Disguised Protectionism? Environmental Policy in the Japanese Car Market
US government criticized Japanese environmental policies for the promotion of eco-friendly car(eco-cars) purchases, e.g. tax exemptions and subsidies, as disguised forms of domestic protection because none of US car models was certified as eco-cars unlike many Japanese car models. The purpose of this paper is to assess whether or not the Japanese environmental policies from 2005 to 2009 were the case of the disguised form of protection that was prohibited under the WTO rule. To achieve this goal, this paper implements counterfactual simulation based on the structural econometric model of multi-product oligopolistic competition to obtain what would happen if the Japanese government introduces an alternative eco-car certification rule that expands the target of the subsidy as suggested by the US government. Simulation results show that although the average fuel economy under the alternative rule is comparable to that under the actual, the alternative one is costly in terms of improving fuel economy because it requires much larger amount of subsidy in order to achieve the same average fuel economy level as in the actual. Accordingly, the Japanese environmental policies were efficient in terms of improving the environmental quality and thus would not be the case of the disguised protectionism.