We tested our hypotheses in the con

We tested our hypotheses in the context of the JET. We analyze the JET as an exogenous shock that disrupted U.S. imports of vehicles and vehicle parts from Japan. As weekly shipments of these goods from Japan to the United States may be affected by various observable and unobservable variables associated with macro-economic changes and firm-level activities, we isolated the effects of the JET from these unobservable factors by setting our model as a natural experiment. We compared changes in shipment volumes between a treatment group—U.S. buyers that source from Japan—and a control group—U.S. buyers that source from Germany—using difference-in-differences models (Imbens and Wooldridge, 2009; Wooldridge 2009). Our approach is explained further in the following subsections.