CIBH The UK Car Market

James Walker - The UK Car Market

The UK car market

My work on the UK car market derives from my Ph.D. thesis with the lengthy if pragmatic title "Determinants of the Decline of British Leyland: The Roles of Product Quality, Advertising and Voluntary Export Restraints (1971-2002)".


The thesis contributes to an established, but largely anecdotal, literature examining the rapid decline of the British car industry's remaining mass producing manufacturer, British Leyland (BL), through the rigorous examination of three key issues raised by historians and contemporaries of the period in relation to the quality of British Leyland's products: (1) the imposition of Voluntary Export Restraints (VERs), between the UK and Japan in 1977 aimed at restricting the quantity of imported Japanese cars to Britain in order to protect domestic firms. (2) `product-led' decline with reference to (a) quality-price relations; spatial competition, evaluating the Product Life Cycle, and quantifying firm capabilities), and (3) losing an advertising war with incumbents. The thesis draws together a variety of primary and secondary literatures and utilises a substantive data set of all new product versions sold in the UK market and over 130 product attributes over the 1971-2002 period that provide a more plausible means to quantify `quality' then conventional research which has relied on predominantly performance based measures. The rich quality of the data, combined with the adoption of structural modelling of the UK market allows me to distinguish between supply side characteristics that have taken centre stage, such as cost raising trade union intransigence, as a rationale for the post-war decline in British industry, to highlight demand factors. More generally the thesis breaks away from the 'declinist' and more recent 'optimist' literatures by adopting a more detailed micro-historical analysis of the mechanisms underlying Britain's performance. I have also been work on aspects of the thesis with Francisco Requena-Silvente at the University of Valencia.

Outputs to date

  • Requena-Silvente, Francisco and James Walker (2009), ‘The Survival of Differentiated Products: An Application to the UK Automobile Market, 1971-2002’, Manchester School, 77(3), 288-316
  • Walker, James and Francisco Requena-Silvente, (2006), 'Calculating Hedonic Price Indices with Unobserved Product Attributes: An Application to the UK Car Market', Economica, 73, 509-532
  • Requena-Silvente, Francisco and James Walker, (2007), 'Investigating Sales and Advertising Rivalry in the UK Multipurpose Vehicle Market', Journal of the Economics of Business, 59(2), 163-180
  • Walker, James and Francisco Requena-Silvente, (2007), 'Pricing-to-Market Behaviour in a Multi-Product Industry: The Case of the UK Car Market (1971-2002)', Journal of Applied Economics, 37, 219-241.