IDEAS home Printed from https://ideas.repec.org/p/arx/papers/2210.05358.html
   My bibliography  Save this paper

On estimating Armington elasticities for Japan's meat imports

Author

Listed:
  • Satoshi Nakano
  • Kazuhiko Nishimura

Abstract

By fully accounting for the distinct tariff regimes levied on imported meat, we estimate substitution elasticities of Japan's two-stage import aggregation functions for beef, chicken and pork. While the regression analysis crucially depends on the price that consumers face, the post-tariff price of imported meat depends not only on ad valorem duties but also on tariff rate quotas and gate price system regimes. The effective tariff rate is consequently evaluated by utilizing monthly transaction data. To address potential endogeneity problems, we apply exchange rates that we believe to be independent of the demand shocks for imported meat. The panel nature of the data allows us to retrieve the first-stage aggregates via time dummy variables, free of demand shocks, to be used as part of the explanatory variable and as an instrument in the second-stage regression.

Suggested Citation

  • Satoshi Nakano & Kazuhiko Nishimura, 2022. "On estimating Armington elasticities for Japan's meat imports," Papers 2210.05358, arXiv.org, revised Oct 2022.
  • Handle: RePEc:arx:papers:2210.05358
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/2210.05358
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Onji, Kazuki, 2014. "The price disparity analysis revisited: An application to pork imports in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 34(C), pages 1-23.
    2. Christian Broda & David E. Weinstein, 2006. "Globalization and the Gains From Variety," The Quarterly Journal of Economics, Oxford University Press, vol. 121(2), pages 541-585.
    3. Hertel, Thomas & Hummels, David & Ivanic, Maros & Keeney, Roman, 2007. "How confident can we be of CGE-based assessments of Free Trade Agreements?," Economic Modelling, Elsevier, vol. 24(4), pages 611-635, July.
    4. Mika Saito, 2004. "Armington elasticities in intermediate inputs trade: a problem in using multilateral trade data," Canadian Journal of Economics, Canadian Economics Association, vol. 37(4), pages 1097-1117, November.
    5. Feenstra, Robert C, 1994. "New Product Varieties and the Measurement of International Prices," American Economic Review, American Economic Association, vol. 84(1), pages 157-177, March.
    6. Bajzik, Josef & Havranek, Tomas & Irsova, Zuzana & Schwarz, Jiri, 2020. "Estimating the Armington elasticity: The importance of study design and publication bias," Journal of International Economics, Elsevier, vol. 127(C).
    7. Marilyne Huchet‐Bourdon & Esmaeil Pishbahar, 2009. "Armington Elasticities and Tariff Regime: An Application to European Union Rice Imports," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(3), pages 586-603, September.
    8. Hélène Erkel‐Rousse & Daniel Mirza, 2002. "Import price elasticities: reconsidering the evidence," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 35(2), pages 282-306, May.
    9. Robert C. Feenstra & Philip Luck & Maurice Obstfeld & Katheryn N. Russ, 2018. "In Search of the Armington Elasticity," The Review of Economics and Statistics, MIT Press, vol. 100(1), pages 135-150, March.
    10. Reinert, Kenneth A. & Roland-Holst, David W., 1992. "Armington elasticities for United States manufacturing sectors," Journal of Policy Modeling, Elsevier, vol. 14(5), pages 631-639, October.
    11. Hillberry, Russell & Hummels, David, 2013. "Trade Elasticity Parameters for a Computable General Equilibrium Model," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1213-1269, Elsevier.
    12. Soderbery, Anson, 2015. "Estimating import supply and demand elasticities: Analysis and implications," Journal of International Economics, Elsevier, vol. 96(1), pages 1-17.
    13. Pablo D Fajgelbaum & Pinelopi K Goldberg & Patrick J Kennedy & Amit K Khandelwal, 2020. "The Return to Protectionism," The Quarterly Journal of Economics, Oxford University Press, vol. 135(1), pages 1-55.
    Full references (including those not matched with items on IDEAS)

    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. Bergstrand, Jeffrey H. & Cray, Stephen R. & Gervais, Antoine, 2023. "Increasing marginal costs, firm heterogeneity, and the gains from “deep” international trade agreements," Journal of International Economics, Elsevier, vol. 144(C).
    2. Bajzik, Josef & Havranek, Tomas & Irsova, Zuzana & Schwarz, Jiri, 2020. "Estimating the Armington elasticity: The importance of study design and publication bias," Journal of International Economics, Elsevier, vol. 127(C).
    3. Olekseyuk, Zoryana & Schürenberg-Frosch, Hannah, 2016. "Are Armington elasticities different across countries and sectors? A European study," Economic Modelling, Elsevier, vol. 55(C), pages 328-342.
    4. Bajzik, Jozef & Havranek, Tomas & Irsova, Zuzana & Schwarz, Jiri, 2019. "The Elasticity of Substitution between Domestic and Foreign Goods: A Quantitative Survey," EconStor Preprints 200207, ZBW - Leibniz Information Centre for Economics.
    5. Lionel Fontagné & Houssein Guimbard & Gianluca Orefice, 2019. "Product-Level Trade Elasticities," Working Papers 2019-17, CEPII research center.
    6. Hillberry, Russell & Hummels, David, 2013. "Trade Elasticity Parameters for a Computable General Equilibrium Model," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1213-1269, Elsevier.
    7. Niemi, Janne, 2018. "Short-run and long-run food import elasticities with persistent trading habits," Working Papers 111, VATT Institute for Economic Research.
    8. Delahaye, Elliot & Milot, Catherine, 2020. "Measuring the UK Economy’s Armington Elasticities," Conference papers 333170, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    9. Oliveira, Paulo Felipe & Cordeiro, Pedro Antero, 2023. "Trade policy analysis in Brazil: Assessing welfare impacts with revised Armington elasticities," Economic Modelling, Elsevier, vol. 129(C).
    10. Ahmad, Saad & Montgomery, Chris & Schreiber, Samantha, 2020. "A Comparison of Armington Elasticity Estimates in the Trade Literature," Conference papers 333215, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    11. Fontagné, Lionel & Martin, Philippe & Orefice, Gianluca, 2018. "The international elasticity puzzle is worse than you think," Journal of International Economics, Elsevier, vol. 115(C), pages 115-129.
    12. Head, Keith & Mayer, Thierry, 2014. "Gravity Equations: Workhorse,Toolkit, and Cookbook," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 131-195, Elsevier.
    13. Fontagné, Lionel & Guimbard, Houssein & Orefice, Gianluca, 2022. "Tariff-based product-level trade elasticities," Journal of International Economics, Elsevier, vol. 137(C).
    14. Aoyagi, Takahide & Ito, Tadashi & Matsuura, Toshiyuki, 2022. "Welfare gains through globalization: Evidence from Japan's manufacturing sector," Journal of the Japanese and International Economies, Elsevier, vol. 64(C).
    15. Rotunno, Lorenzo & Wood, Adrian, 2020. "Wage inequality and skill supplies in a globalised world," Journal of Comparative Economics, Elsevier, vol. 48(3), pages 529-547.
    16. McCleery, Robert & DePaolis, Fernando, 2014. "So you want to build a trade model? Available resources and critical choices," Economic Modelling, Elsevier, vol. 40(C), pages 199-207.
    17. Lorenzo Rotunno & Adrian Wood, 2015. "Wages and endowments in a globalised world," Economics Papers 2015-W11, Economics Group, Nuffield College, University of Oxford.
    18. Rebecca Freeman & Mario Larch & Angelos Theodorakopoulos & Yoto V. Yotov, 2021. "Unlocking New Methods to Estimate Country-Specific Trade Costs and Trade Elasticities," CESifo Working Paper Series 9432, CESifo.
    19. Gustavo de Souza & Naiyuan Hu & Haishi Li & Yuan Mei, 2022. "(Trade) War and Peace: How to Impose International Trade Sanctions," Working Paper Series WP 2022-49, Federal Reserve Bank of Chicago.
    20. repec:hal:wpspec:info:hdl:2441/dambferfb7dfprc9m01g1j1k2 is not listed on IDEAS
    21. Elisaveta Archanskaia & Guillaume Daudin, 2012. "Heterogeneity and the Distance Puzzle," Documents de Travail de l'OFCE 2012-17, Observatoire Francais des Conjonctures Economiques (OFCE).

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:arx:papers:2210.05358. 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: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    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.