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The World Trade Model: Merchandise Trade

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  • Michael C. Deppler

    (International Monetary Fund)

  • Duncan M. Ripley

    (International Monetary Fund)

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    Abstract

    This paper presents a simple semiannual model of world merchandise trade disaggregated by commodity class and by country or country grouping. It is designed principally to estimate the responsiveness of merchandise trade to variations in income and activity levels in the industrial countries. The responsiveness of trade flows to variations in prices is also considered, but the empirical results on price sensitivity appear to be less reliable. The trade flows are disaggregated into four commodity classes--foods, raw materials, fuels, and manufactures--and 18 geographic areas--the 14 industrial countries treated individually and 4 country groups (developed primary producing countries, major oil exporting countries, other developing countries, and the rest of the world--consisting essentially of the centrally planned economies). The model can be thought of as having three principal blocks. The first block determines, for each commodity class, export and import unit values for the industrial countries, given certain spot commodity prices, domestic costs and prices, and exchange rates; the second determines the volume of exports and imports by commodity class for the industrial countries, given prices and the level of final domestic demand. The third block relates export receipts of the country groups to activity levels in the industrial countries, and import expenditure to their foreign exchange earnings. These relationships are estimated on a semiannual basis; the estimation period generally covers the first half of 1964 to the first half of 1976. It is expected that the model will be used for both simulation and forecasting. Its usefulness in terms of simulation is expected to lie in the calculation of countries' trade balances under alternative assumptions about economic activity levels in the industrial countries. The model is also expected to be useful in projecting countries' trade balances for 6 to 18 months ahead, thus providing an input to the semiannual forecasting exercises of the International Monetary Fund. /// Ce document présente un modèle semi-annuel simple du commerce mondial par catégorie de produits ainsi que par pays ou groupe de pays. Le modèle ẹst essentiellement conc̨u pour l'évaluation de la sensibilité des échanges commerciaux aux variations des niveaux de revenu et d'activité dans les pays industrialisés. Il tient également compte de la sensibilité des flux commerciaux aux variations de prix, mais les résultats empiriques obtenus sur la sensibilité des prix semblent moins fiables. Les flux commerciaux sont décomposés en quatre catégories de produits (produits alimentaires, matières premières, combustibles et produits finis) et désagrégés en 18 zones géographiques (les 14 pays industrialisés considérés individuellement et 4 groupes de pays, à savoir les pays développés de production primaire, les principaux pays exportateurs de pétrole, d'autres pays en développement et le reste du monde, c'est-à -dire essentiellement les économies à planification centrale). On peut considérer le modèle comme comprenant trois grands ensembles de structure. Le premier ensemble détermine pour chaque catégorie de produits des valeurs unitaires à l'exportation et à l'importation des pays industrialisés, compte tenu du cours des matières premières au comptant, des coûts et prix intérieurs, et des taux de change; le deuxième ensemble détermine le volume des exportations et importations par catégorie de produits pour les pays industrialisés, compte tenu des prix et du niveau de la demande intérieure finale. Le troisième relie les recettes d'exportation des groupes de pays aux niveaux d'activité dans les pays industrialisés et les dépenses d'importation à leurs recettes en devises. Ces relations sont calculées sur une base semi-annuelle; la période couverte s'étend généralement du premier semestre de 1964 au premier semestre de 1976. Il est prévu que le modèle sera utilisé pour la simulation et la prévision. Son utilité en termes de simulation devrait résider dans le calcul des balances commerciales des pays selon différentes hypothèses de niveaux d'activité économique dans les pays industrialisés. On espère également que le modèle contribuera à la projection des balances commerciales des pays sur des horizons de 6 à 18 mois à l'avance, facilitant ainsi les prévisions semi-annuelles du Fonds monétaire international. /// En este documento se expone un modelo semestral sencillo del comercio mundial de mercancías desagregado por clases de productos y por países o grupos de países. Su finalidad principal es estimar la reacción del comercio de mercancías ante las variaciones del ingreso y los niveles de actividad de los países industriales. También se analiza la reacción de los flujos comerciales ante las variaciones de los precios, pero los resultados empíricos sobre sensibilidad con respecto a los precios parecen ser menos fiables. Los flujos comerciales se desagregan en cuatro clases de productos --alimentos, materias primas, combustibles y manufacturas-- y 18 áreas geográficas: los 14 países industriales individualmente considerados y cuatro grupos de países (países desarrollados de producción primaria, principales países exportadores de petróleo, otros países en desarrollo y el resto del mundo, que comprende fundamentalmente las economías de planificación centralizada). El modelo puede considerarse formado por tres partes principales. En la primera se determinan, para cada clase de productos, los valores unitarios de importación y exportación de los países industriales, dados los precios al contado de los productos primarios, los costos y precios internos y los tipos de cambio; en la segunda se determina el volumen de importación y exportación de los países industriales, por clase de productos, dados los precios y el nivel de la demanda interna final. En la tercera sección se relacionan los ingresos de exportación de los grupos de países con niveles de actividad de los países industriales, y el gasto de importación con sus ingresos de divisas. Estas relaciones se estiman sobre una base semestral; el período de estimación se extiende en general desde el primer semestre de 1964 hasta el primero de 1976. Se cuenta con que el modelo se usará en trabajos de simulación y de previsión. En materia de simulación, se espera que sea útil para calcular las balanzas comerciales de los países con distintos supuestos sobre los niveles de actividad económica de los países industriales. También se cuenta con que sea útil para proyectar las balanzas comerciales de los países con una anticipación de entre 6 y 18 meses, con lo cual proporcionaría un insumo para los trabajos semestrales de previsión del Fondo Monetario Internacional.

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    Bibliographic Info

    Article provided by Palgrave Macmillan in its journal Staff Papers - International Monetary Fund.

    Volume (Year): 25 (1978)
    Issue (Month): 1 (March)
    Pages: 147-206

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    Handle: RePEc:pal:imfstp:v:25:y:1978:i:1:p:147-206

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    Cited by:
    1. Thorvaldur Gylfason, 2002. "The Real Exchange Rate Always Floats," Australian Economic Papers, Wiley Blackwell, Wiley Blackwell, vol. 41(4), pages 369-381, December.
    2. Sawyer, W. Charles & Sprinkle, Richard L., 1997. "The Demand for Imports and Exports in Japan: A Survey," Journal of the Japanese and International Economies, Elsevier, vol. 11(2), pages 247-259, June.
    3. Jaime Marquez, 1994. "The constancy of illusions or the illusion of constancies: income and price elasticities for U.S. imports, 1890-1992," International Finance Discussion Papers, Board of Governors of the Federal Reserve System (U.S.) 475, Board of Governors of the Federal Reserve System (U.S.).
    4. Jaime Marquez, 1995. "A century of trade elasticities for Canada, Japan, and the United States," International Finance Discussion Papers, Board of Governors of the Federal Reserve System (U.S.) 531, Board of Governors of the Federal Reserve System (U.S.).
    5. Winters, L. Alan, 1985. "Separability and the modelling of international economic integration," European Economic Review, Elsevier, Elsevier, vol. 27(3), pages 335-353.

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