LIML Estimation of Import Demand and Export Supply Elasticities
Following the seminal contribution of Feenstra (1994), I apply limited-information maximum likelihood to estimate import demand and export supply elasticities for a range of eurozone countries. The results highlight substantial inconsistencies in the parameters estimated by the methodology of Fuller (1977) relative to the parameters estimated by the methodology of Hausman et al (2012). The nature of the structural equations reveals complications generated by the limiting behavior of the parameters that can be replicated in finite samples. The results of simulations underscore substantial improvements in parameter estimates in a three-dimensional panel, suggesting that the problem of limiting behaviour can be overcome in larger dataset/panels.
|Date of creation:||Mar 2016|
|Date of revision:||Jun 2016|
|Contact details of provider:|| Postal: Trinity College, Dublin 2|
Phone: (+ 353 1) 6081325
Web page: http://www.tcd.ie/Economics/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Soderbery, Anson, 2015. "Estimating import supply and demand elasticities: Analysis and implications," Journal of International Economics, Elsevier, vol. 96(1), pages 1-17.
- Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119, April.
- Soderbery, Anson, 2010. "Investigating the asymptotic properties of import elasticity estimates," Economics Letters, Elsevier, vol. 109(2), pages 57-62, November.
When requesting a correction, please mention this item's handle: RePEc:tcd:tcduee:tep0316. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Patricia Hughes)
If references are entirely missing, you can add them using this form.