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Again on trade elasticities: evidence from a selected sample of countries

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Listed author(s):
  • Francesco Aiello

    ()

  • Graziella Bonanno

    ()

  • Alessia Via

    ()

Abstract

This paper focuses on trade elasticities by analysing the case of China, France, Germany, Italy, Japan, UK, and the USA over the period 1990–2012. While the empirical setting mainly refers to panel data techniques for non-stationary data, the VECM model complements the analysis at single-country level. After having shown that long-run relationships are stable to any structural break, it is found that exports and imports are price inelastic for most of the countries in the sample. Furthermore, exports and imports are determined by domestic and foreign income, with asymmetric income elasticities. This helps to explain why global trade imbalances are persistent. Copyright Eurasia Business and Economics Society 2015

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File URL: http://hdl.handle.net/10.1007/s40821-015-0026-0
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Article provided by Springer & Eurasia Business and Economics Society in its journal Eurasian Business Review.

Volume (Year): 5 (2015)
Issue (Month): 2 (December)
Pages: 259-287

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Handle: RePEc:spr:eurasi:v:5:y:2015:i:2:p:259-287
DOI: 10.1007/s40821-015-0026-0
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Keywords: Trade elasticities; Global trade imbalances; Panel data; C23; F10; F17; F37; P33;

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  • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
  • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
  • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities

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Cited by:

  1. Magdalena Olczyk, 2016. "A systematic retrieval of international competitiveness literature: a bibliometric study," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 6(3), pages 429-457, December.

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