Yoichi, Matsubayashi and Shigeyuki, Hamori (2009): Empirical Analysis of Import Demand Behavior of Least Developed Countries. Published in: Economics Bulletin , Vol. 29, No. 2 (June 2009): pp. 14601475.

PDF
MPRA_paper_17266.pdf Download (141kB)  Preview 
Abstract
This paper examines the longrun stability of import demand function in least developed countries (LDCs) using recently developed panel cointegration techniques. We test for cointegration using two data sets: a) annual data for 15 countries from 1965 to 2004; and b) annual data for 22 countries from 1984 to 2004. We find that cointegration is present and that, indeed, there is a stable import demand function in these economies. The income elasticity ranges from 1.26 to 1.69 and price elasticity ranges from 0.72 to 0.75.
Item Type:  MPRA Paper 

Original Title:  Empirical Analysis of Import Demand Behavior of Least Developed Countries 
Language:  English 
Keywords:  import demand, panel unit root, panel cointegration, LDCs 
Subjects:  O  Economic Development, Innovation, Technological Change, and Growth > O1  Economic Development > O11  Macroeconomic Analyses of Economic Development F  International Economics > F4  Macroeconomic Aspects of International Trade and Finance > F41  Open Economy Macroeconomics 
Item ID:  17266 
Depositing User:  Shigeyuki Hamori 
Date Deposited:  13. Sep 2009 13:49 
Last Modified:  12. Feb 2013 01:36 
References:  BahmaniOskooeea, M. and A. Rathab (2008) "Exchange Rate Sensitivity of US Bilateral Trade Flows" Economics Systems 32, 129–141. Breitung, J. (2000) "The Local Power of Some Unit Root Tests for Panel Data" in Advances in Econometrics: Nonstationary Panels, Panel Cointegration, and Dynamic Panels by B. Baltagi, Ed., JAI Press: Amsterdam, 15 161–178. Carone, G. (1996) "Modeling of the U.S. Demand for Imports Through Cointegration and Error Correction" Journal of Policy Modeling 18, 1–48. Choi, I. (2001) "Unit Root Tests for Panel Data" Journal of International Money and Finance 20, 249–272. Dutta, D. and N. Ahmed (2004) "An Aggregate Import Demand Function for India: A Cointegration Approach" Applied Economics Letters 11, 607–613. Dutta, D. and N. Ahmed (1999) "An Aggregate Import Demand Function for Bangladesh: A Cointegration Approach" Applied Economics 31, 465–472. Faini, R., Pritchett, L., and F. Clavijo (1992) "Import Demand in Developing Countries" in International Trade Modeling by M. G. Dagenais and P. A. Must, Eds., Chapman & Hall, London and New York. Goldstein, M. and M.S. Khan (1985) "Income and Price Effects in Foreign Trade" in Handbook of International Economics by R.W. Jones and P.B. Kenen, Eds., 2, 1041–1099. Hamori, S. and Y. Matsubayashi (2001) "An Empirical Analysis on the Stability of Japan’s Aggregate Import Demand Function" Japan and the World Economy 13, 135–144. Harb, N. (2005) "Import Demand in Heterogeneous Panel Setting" Applied Economics 37, 2407–2415. Hemphill, W. L. (1974) "The Effect of Foreign Exchange Receipts on Imports of Less Developed Countries" IMF Staff Papers 21, 637–677. Im, K.S., Pesaran, M.H. and Y. Shin (2003) "Testing for unit roots in heterogeneous panels" Journal of Econometrics 115, 53–74. Johansen, S. and K. Juselius (1990) "Maximum Likelihood Estimation and Inference on Cointegration: With Application to the Demand for Money" Oxford Bulletin of Economics and Statistics 52, 169–210. Johansen, S. (1988) "Statistical Analysis of Cointegrating Vectors" Journal of Economic Dynamics and Control 12, 213–54. Kao, C. (1999) "Spurious Regression and ResidualBased Tests for Cointegration in Panel Data" Journal of Econometrics 90, 1–44. Khan, M. S. (1974) "Import and Export Demand in Developing Countries" IMF Staff Papers 21, 678–693. Levin, A., Lin, C. F. and C.S.J. Chu, (2002) "Unit Root Tests in Panel Data: Asymptotic and FiniteSample Properties" Journal of Econometrics 108, 1–24. Maddala, G. S. and S. Wu (1999) "A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test" Oxford Bulletin of Economics and Statistics 61, 631–52. Mah, J. S. (1994) "Japanese Import Behavior: The Cointegration Approach" Journal of Policy Modeling 16, 291–298. Masih, R. and A. M. Masih (2000) "A Reassessment of LongRun Elasticities of Japanese Import Demand" Journal of Policy Modeling 22, 625–639. Matsubayashi, Y. and S. Hamori (2003) "Some International Evidence on the Stability of Aggregate Import Demand Function" Applied Economics 35, 1497–1504. Pedroni, P. (2004) "Panel Cointegration: Asymptotic and Finite Sample Properties of Pooled Time Series Tests with an Application to the PPP Hypothesis" Econometric Theory 20, 597–625. Pedroni, P. (2001) "Purchasing Power Parity Tests in Cointegrated Panels" Review of Economics and Statistics 83, 727–731. Pedroni, P. (1999) "Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors" Oxford Bulletin of Economics and Statistics 61, 653–70. Razafimahefa, I. F. and S. Hamori (2007) International Competitiveness in Africa: Policy Implications in the SubSaharan Region, Springer, Berlin. Razafimahefa, I. F. and S. Hamori (2005) "Import Demand Function: Some Evidence from Madagascar and Mauritius" Journal of African Economies 14, 411–434. Reinhart, C. M. (1995) "Devaluation, Relative Prices, and International Trade" IMF Staff Papers 42, 290–312. Sawyer, W. C. and R. L. Sprinkle (1999) The Demand for Imports and Exports in the World Economy, Ashgate, Aldershot. Stern, R. M., Francis, J. and B. Schumacher (1976) Price Elasticities in International Trade: An Annotated Bibliography, Macmillan, London. United Nations (2005) "Statistical Profiles of the Least Developed Countries" The United Nations on Conference Trade and Development. Urbain, J. P. (1996) "Japanese Import Behavior and Cointegration: A Comment" Journal of Policy Modeling 18, 583–601. Urbain, J. P. (1992) "Error Correction Models of for Aggregate Imports: The Case of Two Small and Open Economies" in International Trade Modeling by M.G. Dagenais and P.A. Must, Eds., Chapman & Hall, London and New York. 
URI:  https://mpra.ub.unimuenchen.de/id/eprint/17266 