Chipman, John S. and Eymann, Angelika and Ronning, Gerd and Tian, Guoqiang (1992): Estimating Price Responses of German Imports and Exports. Published in: European Integration in the World Economy (1992): pp. 574-637.
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This paper estimates trade-demand functions for Germany from monthly data covering the period 1959-1988. It is assumed that these trade-demand functions have the form of the Linear Expenditure System, generated by a shifted Cobb-Douglas trade-utility function in which the shift parameter is postulated to be a function of time (including trend and seasonal components) and to have a stochastic term with a lognormal distribution. A procedure called generalized maximum likelihood is used, and the results are compared with those of nonlinear least squares as a benchmark. The approach is applied to two models: (1) a six-commodity model in which the dependent variables are net imports in six categories and the independent variables are six weighted averages of the import- and export-price indices for these categories as well as the trade deficit; (2) a twelve-commodity model in which the dependent variables are the gross imports and gross exports (the latter measured negatively) in the six categories and the independent variables are the twelve import- and export-price indices and the trade deficit. The latter model thus handles the case of “intra-industry trade”.
|Item Type:||MPRA Paper|
|Original Title:||Estimating Price Responses of German Imports and Exports|
|Keywords:||Price Response; German Imports and Exports|
|Subjects:||E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles|
|Depositing User:||Guoqiang Tian|
|Date Deposited:||15. Sep 2012 20:53|
|Last Modified:||12. Feb 2013 10:03|
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