Frimpong, Joseph Magnus and Oteng-Abayie, Eric Fosu (2006): Aggregate Import demand and Expenditure Components in Ghana:An Econometric Analysis.
Download (112Kb) | Preview
In this paper, the behaviour of Ghana’s imports during the period 1970-2002 is studied using disaggregated expenditure components of total national income. We use the newly developed bounds testing approach to cointegration and estimated an error correction model to separate the short- and long-run elements of the import demand relationship. The study shows inelastic import demand for all the expenditure components and relative price. In the long-run, investment and exports are the major determinant of movements in imports in Ghana. In the short run household and government consumption expenditures is the major determinant of import demand. Import demand is not very sensitive to price changes.
|Item Type:||MPRA Paper|
|Original Title:||Aggregate Import demand and Expenditure Components in Ghana:An Econometric Analysis|
|Keywords:||import demand; imperfect substitution; ARDL cointegration; bounds test approach|
|Subjects:||F - International Economics > F1 - Trade > F10 - General
C - Mathematical and Quantitative Methods > C2 - Single Equation Models; Single Variables > C22 - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models
F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F41 - Open Economy Macroeconomics
|Depositing User:||Eric Fosu Oteng-Abayie|
|Date Deposited:||27. Oct 2006|
|Last Modified:||12. Feb 2013 04:35|
Abbott, A.J. and Seddighi, H.R., (1996). “Aggregate imports and expenditure components in the UK: an empirical analysis”, Applied Economics, Vol. 28, pp. 1119-25. Agbola F.W. and M.Y. Damoense (2005), “Time-series estimation of import demand functions for pulses in India” Journal of Economic Studies, Vol. 32 No. 2, 2005, pp. 146-157. Emerald Group Publishing Limited Bank of Ghana, Bank of Ghana Statistical Bulletin, various issues Carone, G. (1996). “Modeling the US demand for imports through cointegration and error correction”, Journal of Policy Modeling, Vol. 18, pp. 1-48. Giovannetti, G. (1989). “Aggregate imports and expenditure components in Italy: an econometric analysis”, Applied Economics, Vol. 21, pp. 957-71. Goldstein, M. and Khan, M., (1985). “Income and Price Effects in Foreign Trade”. In Handbook of International Economics, Vol. 2 (Jones, R. and Kenen, P. Ed.). Amsterdam and New York, North-Holland, Elsevier, pp1041-1105. Ho, W.S. (2004). “Estimating Macao’s Import Demand Functions”, Monetary Authority of Macao. Hong, P. (1999). “Import Elasticities Revisited”, DESA Discussion Paper Series, ST/ESA/1999/DP.10, Department of Economic and Social Affairs, The United Nations. Johansen (1988). “Statistical Analysis of Cointegrating Vectors,” Journal of Economic Dynamic and Control, Vol.12, pp 231-54. Johansen and Juselius, (1990). “Maximum Likelihood Estimation and Inference on Cointegration with Applications the Demand for Money, “Oxford Bulletin of Economics and Statistics, Vo1 52, No.2, 169-210. Johansen, et al, (1991). “Estimation and Hypothesis Testing of Cointegration Vector Autoregressive Models”, Econometrica, Vol. 59, 1551-1580. Magee, S.P. (1975). “Prices, income and foreign trade: a survey of recent economic studies”, in Kenen, P.B. (Ed.), International Trade and Finance: Frontiers for Research, Cambridge University Press, Cambridge. Min, B.S., Mohammed, H.A. and Tang, T.C., (2002). “An analysis of South Korea’s import demand”, Journal of Asia Pacific Affairs, Vol. 4, pp. 1-17. Mohammed, H.A. and Tang, T.C., (2000). “Aggregate imports and expenditure components in Malaysia: a cointegration and error correction analysis”, ASEAN Economic Bulletin, Vol. 17, pp. 257-69. Mohammed, H.A. and J. Othman (2001). “Aggregate Import Demand and Expenditure Components in five ASEAN Countries: An Empirical Study,” Jurnal Ekonomi Malaysia, Vol. 35, 37-60. Narayan, P.K. (2004), “Reformulating critical values for the bounds F-statictics approach to cointegration: an application to the tourism demand model for Fiji”, Department of Economics Discussion Papers N0.02/04, Monash University, Melbourne. Narayan, P.K. and Narayan, S., (2005). “An empirical analysis of Fiji’s import demand function”, Journal of Economic Studies, Vol. 32 No. 2, 2005, pp. 158-168. Emerald Group Publishing Limited Pesaran, M.H., Shin, Yong Cheol and Smith, R., (2001). “Bound Testing Approaches to the Analysis of Level Relationships”. Journal of Applied Econometrics, 16, 289-326. Phillips, P.C.B. and Perron, P., (1988). “Testing for a Unit Root in Time Series Regression,” Biometrika, 75, 335–346. Senhadji, A. (1998). “Time-series estimation of structural import demand equations: a cross-country analysis”, IMF Staff Papers, Vol. 45 No. 2, pp. 236-68. Sinha, D. (1997), “Determinants of import demand in Thailand”, International Economic Journal, Vol. 11, pp. 73-83. Tambi N. E. (1998), “Trade liberalization effects on commodity imports in Cameroon”, Journal of Economic Studies, Volume 25 Number 3 1998 pp. 193-202 Tang, T.C. (2003). “An empirical analysis of China’s aggregate import demand function”, China Economic Review, Vol. 12 No. 2, pp. 142-63.