Working Paper: NBER ID: w21000
Authors: Austan D. Goolsbee; Alan B. Krueger
Abstract: This paper takes a retrospective look at the U.S. government’s effort to rescue and restructure General Motors and Chrysler in the midst of the 2009 economic and financial crisis. The paper describes how two of the largest industrial companies in the world came to seek a bailout from the U.S. government, the analysis used to evaluate their request, and the steps taken by the government to rescue them. The paper also summarizes the performance of the U.S. auto industry since the bailout and draws some general lessons from the episode.
Keywords: auto industry; bailout; economic crisis; restructuring
JEL Codes: E0; G01; G33; H0; J01; L50; L62
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| bailout (H81) | survival of GM and Chrysler (G33) |
| survival of GM and Chrysler (G33) | prevention of systemic failures in auto supply chain (L62) |
| bailout (H81) | prevention of deeper recession and longer economic recovery (E65) |
| successful restructuring (L16) | recovery and profitability of GM and Chrysler (G33) |
| bailout (H81) | support for consumer confidence (D12) |
| support for consumer confidence (D12) | recovery of auto sales (L81) |