Import Price Uncertainty and the Distribution of Income
In this paper we estimate oil and nonoil import demand functions for the United States under the assumption that import prices are uncertain. Both import demand functions are formally derived from an expected utility maximization problem, treating imports as inputs to the technology. The model allows us to test for risk aversion and to assess the impact of uncertainty on the volume of imports, gross output, and the distribution of income. We find that uncertainty leads to a reduction in welfare, imports, and gross output. Moreover, it hurts labor relatively much more than capital. The impact of uncertainty, however, is found to be quite small.
|Date of creation:||Nov 1996|
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- Appelbaum, Elie & Kohli, Ulrich, 1998.
"Import-Price Uncertainty, Production Decisions, and Relative Factor Shares,"
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- Elie Appelbaum & Ulrich Kohli, 1997. "Import-Price Uncertainty, Production Decisions, and Relative Factor Shares," Working Papers 1997_4, York University, Department of Economics.
- David S. Bullock & Philip Garcia & Kie-Yup Shin, 2005. "Measuring producer welfare under output price uncertainty and risk non-neutrality," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 49(1), pages 1-21, 03.
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- Christis G. Tombazos, 2003. "A Production Theory Approach to the Imports and Wage Inequality Nexus," Economic Inquiry, Western Economic Association International, vol. 41(1), pages 42-61, January.
- Andrew Muhammad, 2012. "Source Diversification and Import Price Risk," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(3), pages 801-814.
- Appelbaum, Elie, 2006. "A framework for empirical applications of production theory without expected utility," Journal of Economics and Business, Elsevier, vol. 58(4), pages 290-302.
- Elie Appelbaum, 1996. "An Application of Duality under Uncertainty, Elie Appelbaum," Working Papers 1996_8, York University, Department of Economics.
- Alberto Behar, 2005.
"Does training benefit those who do not get any? Elasticities of complementarity and factor price in South Africa,"
Economics Series Working Papers
244, University of Oxford, Department of Economics.
- Alberto Behar, 2008. "Does training benefit those who do not get any? Elasticities of complementarity and factor price in South Africa," Working Papers 73, Economic Research Southern Africa.
- Elie Appelbaum & Aman Ullah, 1996.
"Estimation of moments and production decisions under uncertainty,"
1996_9, York University, Department of Economics.
- Elie Appelbaum & Aman Ullah, 1997. "Estimation Of Moments And Production Decisions Under Uncertainty," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 631-637, November.
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