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Some international evidence on the stability of aggregate import demand function

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  • Yoichi Matsubayashi
  • Shigeyuki Hamori

Abstract

This paper empirically analyses the stability of the aggregate import demand function for G7 countries. The standard cointegration test and a test developed by Gregory and Hansen are performed. The results of standard cointegration tests suggest that there is no stable cointegrating relation between real import, real GDP and relative import price for all G7 countries. The cointegrating relation is empirically supported for France and Germany if structural change for cointegrating vector is explicitly taken into consideration. The cointegrating relation is empirically rejected for Canada, Italy, Japan, the UK and the USA. Thus, the stimulation of domestic business conditions will not necessarily link the quantity of imports for these five countries.

Suggested Citation

  • Yoichi Matsubayashi & Shigeyuki Hamori, 2003. "Some international evidence on the stability of aggregate import demand function," Applied Economics, Taylor & Francis Journals, vol. 35(13), pages 1497-1504.
  • Handle: RePEc:taf:applec:v:35:y:2003:i:13:p:1497-1504
    DOI: 10.1080/0003684032000095965
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    References listed on IDEAS

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    Cited by:

    1. Nelson Modeste, 2011. "An Empirical Analysis of the Demand for Imports in Three CARICOM Member Countries: An Application of the Bounds Test for Cointegration," The Review of Black Political Economy, Springer;National Economic Association, vol. 38(1), pages 53-62, March.
    2. Yoichi Matsubayashi & Shigeyuki Hamori, 2009. "Empirical analysis of import demand behavior of least developed countries," Economics Bulletin, AccessEcon, vol. 29(2), pages 1443-1458.
    3. Matsubayashi, Yoichi, 2005. "Are US current account deficits unsustainable?: Testing for the private and government intertemporal budget constraints," Japan and the World Economy, Elsevier, vol. 17(2), pages 223-237, April.

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