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Estimation of the elasticity of substitution between imported and domestically produced intermediate inputs

Author

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  • Chris M. Alaouze

Abstract

This 1977 paper is one of several by Alaouze about estimating Armington elasticities for the ORANI model. It postulates that during periods of high demand, domestic producers are unable to supply goods promptly and so purchasers must wait for delivery. The implicit cost of waiting for domestic goods inclines users to imported equivalents, even if domestic prices do not rise relative to foreign. A measure or index for "pressure of demand" is described which is then used as a regressor to explain import demand. Please note: The PDF download of this fairly old paper is an optical scan of indifferent, but legible, quality

Suggested Citation

  • Chris M. Alaouze, 1977. "Estimation of the elasticity of substitution between imported and domestically produced intermediate inputs," Centre of Policy Studies/IMPACT Centre Working Papers op-16, Victoria University, Centre of Policy Studies/IMPACT Centre.
    • Handle: RePEc:cop:wpaper:op-16
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    File URL: https://www.copsmodels.com/ftp/workpapr/op-16.pdf
    File Function: Initial version, 1977-10
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    File URL: https://www.copsmodels.com/elecpapr/op-16.htm
    File Function: Local abstract: may link to additional material.
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    Citations

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    Cited by:

    1. Kenneth W. Clements & Marc Jim M. Mariano & George Verikios, 2021. "Foreign-domestic substitution, import penetration and CGE modelling," Applied Economics, Taylor & Francis Journals, vol. 53(35), pages 4080-4099, July.
    2. Chris M. Alaouze, 1977. "Estimates of the elasticity of substitution between imported and domestically produced goods classified at the input-output level of aggregation," Centre of Policy Studies/IMPACT Centre Working Papers o-13, Victoria University, Centre of Policy Studies/IMPACT Centre.
    3. 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).
    4. Yao, Guolin & Hillberry, Russell, 2018. "Structural Gravity Model Estimates of Nested CES Import Demands for Soybeans," 2018 Annual Meeting, August 5-7, Washington, D.C. 274281, Agricultural and Applied Economics Association.
    5. Lächler, Ulrich, 1984. "The elasticity of substitution between imported and domestically produced goods in Germany," Kiel Working Papers 200, Kiel Institute for the World Economy (IfW Kiel).

    More about this item

    Keywords

    Armington elasticities; import share;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation

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