IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v34y2002i8p1025-1032.html
   My bibliography  Save this article

Long-run price and income elasticities of demand for Hong Kong exports: a structural cointegrating VAR approach

Author

Listed:
  • A. J. Abbott
  • G. De Vita

Abstract

This article revisits a system of export volume and price equations to estimate the long-run price and income effects in the demand for Hong Kong's exports. Using a recently developed restricted cointegrating VAR approach it tests theorybased restrictions and obtains estimates of the long-run structural coefficients. The estimation results provide supporting evidence for the theory-based restrictions and suggest that the demand for Hong Kong's exports is both price and income elastic. This article is therefore able to present a long-run model of Hong Kong's exports that is both theory and data consistent, and long-run elasticities that are economically interpretable. The short-run properties of the model are illustrated by means of persistence profiles, which confirm the cointegrating vectors tendency of convergence.

Suggested Citation

  • A. J. Abbott & G. De Vita, 2002. "Long-run price and income elasticities of demand for Hong Kong exports: a structural cointegrating VAR approach," Applied Economics, Taylor & Francis Journals, vol. 34(8), pages 1025-1032.
    • Handle: RePEc:taf:applec:v:34:y:2002:i:8:p:1025-1032
    DOI: 10.1080/00036840110514
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/00036840110514
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00036840110514?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Prema-chandra Athukorala, 1990. "How valid is the Small-Country Assumption?," Working Papers 1990.02 EDIRC Provider-In, School of Economics, La Trobe University.
    2. Stephen G. Hall & Jennifer V. Greenslade & S. G. Brian Henry, 1999. "On the Identification of Cointegrated Systems in Small Samples: Practical Procedures with an Application to UK Wages and Prices," Computing in Economics and Finance 1999 643, Society for Computational Economics.
    3. Anthony Garratt & Kevin Lee & Yongcheol Shin, 1999. "A long run structural macroeconometric model of the UK (first version)," Edinburgh School of Economics Discussion Paper Series 17, Edinburgh School of Economics, University of Edinburgh.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. B. Bhaskara Rao & Rup Singh, 2007. "Estimating export equations," Applied Economics Letters, Taylor & Francis Journals, vol. 14(11), pages 799-802.
    2. Koi Nyen Wong & Tuck Cheong Tang, 2009. "Exchange rate variability and the export demand for Malaysia's semiconductors: an empirical study," Applied Economics, Taylor & Francis Journals, vol. 43(6), pages 695-706.
    3. Maja Kadievska-Vojnovic & Danica Unevska, 2007. "Price and Income Elasticities of Export and Import and Economic Growth in the case of the Republic of Macedonia," Working Papers 2007-01, National Bank of the Republic of North Macedonia.
    4. Athukorala, Premachandra & Riedel, James, 1994. "Demand and Supply Factors in the Determination of NIE Exports: A Simultaneous Error-Correction Model for Hong Kong: A Comment," Economic Journal, Royal Economic Society, vol. 104(427), pages 1411-1414, November.
    5. Rabia Latif & Attiya Yasmin Javid, 2016. "The Determinants of Pakistan Exports of Textile: An Integrated Demand and Supply Approach," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 55(3), pages 191-210.
    6. Baak, SaangJoon, 2014. "Do Chinese and Korean products compete in the Japanese market? An investigation of machinery exports," Journal of the Japanese and International Economies, Elsevier, vol. 34(C), pages 256-271.
    7. Michael K. Salemi, 2007. "Long-run and Cyclic Movements in the Unemployment Rate in Hong Kong: A Dynamic, General Equilibrium Approach," Working Papers 192007, Hong Kong Institute for Monetary Research.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Keblowski, Piotr & Welfe, Aleksander, 2010. "Estimation of the equilibrium exchange rate: The CHEER approach," Journal of International Money and Finance, Elsevier, vol. 29(7), pages 1385-1397, November.
    2. Claus Brand & Nuno Cassola, 2004. "A money demand system for euro area M3," Applied Economics, Taylor & Francis Journals, vol. 36(8), pages 817-838.
    3. Rault, Christophe, 2005. "Further Results on Weak Exogeneity in Vector Error Correction Models," Brazilian Review of Econometrics, Sociedade Brasileira de Econometria - SBE, vol. 25(2), November.
    4. Aleksander Welfe & Piotr Keblowski, 2006. "Price-Wage System with Taxation: Multivariate Cointegration Analysis," Working Papers 13, Department of Applied Econometrics, Warsaw School of Economics.
    5. de Wet, Albertus H. & van Eyden, Reneé & Gupta, Rangan, 2009. "Linking global economic dynamics to a South African-specific credit risk correlation model," Economic Modelling, Elsevier, vol. 26(5), pages 1000-1011, September.
    6. Mukerji, S., 1995. "A theory of play for games in strategic form when rationality is not common knowledge," Discussion Paper Series In Economics And Econometrics 9519, Economics Division, School of Social Sciences, University of Southampton.
    7. Kaufmann, Robert K. & Dees, Stephane & Mann, Micheal, 2009. "Horizontal and vertical transmissions in the US oil supply chain," Energy Policy, Elsevier, vol. 37(2), pages 644-650, February.
    8. Parent, Antoine & Rault, Christophe, 2004. "The Influences Affecting French Assets Abroad Prior to 1914," The Journal of Economic History, Cambridge University Press, vol. 64(2), pages 328-362, June.
    9. Qizilbash, M., 1994. "Corruption, temptation and guilt: moral character in economic theory," Discussion Paper Series In Economics And Econometrics 9419, Economics Division, School of Social Sciences, University of Southampton.
    10. Ulph, A. & Valentini, L., 1998. "Is environmental dumping greater when firms are footloose?," Discussion Paper Series In Economics And Econometrics 9819, Economics Division, School of Social Sciences, University of Southampton.
    11. Imke Brüggemann, 2003. "Measuring Monetary Policy in Germany: A Structural Vector Error Correction Approach," German Economic Review, Verein für Socialpolitik, vol. 4(3), pages 307-339, August.
    12. Hall, Stephen & Mizon, Grayham E. & Welfe, Aleksander, 2000. "Modelling economies in transition: an introduction," Economic Modelling, Elsevier, vol. 17(3), pages 339-357, August.
    13. Colin Ellis & Simon Price, 2003. "The impact of price competitiveness on UK producer price behaviour," Bank of England working papers 178, Bank of England.
    14. Imke Brüggemann, 2003. "Measuring Monetary Policy in Germany: A Structural Vector Error Correction Approach," German Economic Review, Verein für Socialpolitik, vol. 4, pages 307-339, August.
    15. José Antonio Gibanel Salazar, 2014. "Economic models: comparative analysis of their adjustment and prediction capacities," Contribuciones a la Economía, Servicios Académicos Intercontinentales SL, issue 2014-05, November.
    16. Cook, S., 1996. "Econometric methodology II: the role of the philosophy of science," Discussion Paper Series In Economics And Econometrics 9619, Economics Division, School of Social Sciences, University of Southampton.
    17. Katarzyna Leszkiewicz-Kędzior, 2011. "Modelling Fuel Prices. An I(1) Analysis," Central European Journal of Economic Modelling and Econometrics, Central European Journal of Economic Modelling and Econometrics, vol. 3(2), pages 75-95, June.
    18. Katarzyna Budnik, 2008. "Non-accelerating wage inflation rate of unemployment in Poland," NBP Working Papers 48, Narodowy Bank Polski.
    19. Rayner, J., 1992. "Identification of structural VARs," Discussion Paper Series In Economics And Econometrics 9219, Economics Division, School of Social Sciences, University of Southampton.
    20. Abbott, Andrew & De Vita, Glauco, 2002. "Testing the long-run structural validity of the monetary exchange rate model," Economics Letters, Elsevier, vol. 75(2), pages 157-164, April.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:34:y:2002:i:8:p:1025-1032. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.