The techniques of government regulation of the motor vehicle industry are reviewed as applied to safety, pollution control, and fuel economy. Motor vehicle regulations have always been designated as performance standards rather than design standards. Limitations of performance standards include lack of precision which must be overcome by specification of testing procedure or design supplements; restriction of innovation by the nature of the test procedure; lack of a stable system of measurement; and high financial risk. Performance standards may also have undesirable side effects as unintended consequences of regulatory action. Those for fuel economy regulations are discussed: worsened safety record (because of downsizing), further automotive industry concentration, and supply bottlenecks. It is concluded that performance regulations tend to favor innovations; that design regulations involve less financial risk to manufacturers; and that performance regulations tend to emphasize the short-term characteristics of materials used in products while design regulations tend to emphasize long-term characteristics. It is also concluded that the dynamics of regulatory interaction and controversy between regulators and producers differ between the two types of regulation. It is argued that design regulations supplemented by performance standards, as well as innovative techniques in regulation, may facilitate innovation in manufacturing. The importance of quantifying costs and benefits of regulation is suggested.

  • Supplemental Notes:
    • Also published in HS-028 918, "Government, Technology, and the Future of the Automobile," New York, 1980 p 64-76. Presented at Harvard Business School Symposium on Government, Technology, and the Automotive Future, Boston, 19-20 October 1978.
  • Corporate Authors:

    McGraw-Hill, Incorporated

    330 West 42nd Street
    New York, NY  United States  10036
  • Authors:
    • Mills, D Q
  • Publication Date: 1980

Media Info

  • Features: References;
  • Pagination: 13 p.

Subject/Index Terms

Filing Info

  • Accession Number: 00392306
  • Record Type: Publication
  • Source Agency: National Highway Traffic Safety Administration
  • Report/Paper Numbers: HS-028 922
  • Files: HSL, USDOT
  • Created Date: Feb 28 1985 12:00AM