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Chile: Trade Performance, Trade Liberalization, and Competitiveness

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  • Brieuc Monfort

Abstract

This paper analyses the evolution of Chile's trade between 1990 and 2007, studying in particular the impact of trade liberalization in addition to traditional price and demand determinants. The results show that export and import flows are mainly responsive to external and domestic demand, and less so to relative prices, although there is a small impact on imports. In addition, the analysis suggests that trade liberalization may have played a role in increasing exports and imports. Estimations of trade elasticities for other countries in Latin America tend to confirm the results found for Chile.

Suggested Citation

  • Brieuc Monfort, 2008. "Chile: Trade Performance, Trade Liberalization, and Competitiveness," IMF Working Papers 2008/128, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2008/128
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    References listed on IDEAS

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    1. Mabel Cabezas, 2003. "Tratado de Libre Comercio Entre Chile y Estados Unidos: Revisión de Estudios que Cuantifican su Impacto," Working Papers Central Bank of Chile 239, Central Bank of Chile.
    2. Stock, James H & Watson, Mark W, 1993. "A Simple Estimator of Cointegrating Vectors in Higher Order Integrated Systems," Econometrica, Econometric Society, vol. 61(4), pages 783-820, July.
    3. Juan Nicolás Hernández, 2005. "Demanda De Importaciones Para El Caso Colombiano: 1980 - 2004," Borradores de Economia 356, Banco de la Republica de Colombia.
    4. Claudio Bravo-Ortega & Manuel Agosin Trumper, 2007. "The Emergence Of New Successful Export Activities In Latin America: The Case Of Chile," Working Papers wp236, University of Chile, Department of Economics.
    5. Juan Nicolás Hernández, 2005. "Demanda De Exportaciones No Tradicionales En Colombia," Borradores de Economia 2268, Banco de la Republica.
    6. Roberto Alvarez & J. Rodrigo Fuentes, 2006. "Trade Reforms and Manufacturing Industry in Chile," Palgrave Macmillan Books, in: Patricio A. Aroca & Geoffrey J. D. Hewings (ed.), Structure and Structural Change in the Chilean Economy, chapter 4, pages 71-94, Palgrave Macmillan.
    7. NOWAK-LEHMANN D., Felicitas & HERZER, Dierk & VOLLMER, Sebastian, 2007. "The Free Trade Agreement Between Chile And The Eu: Its Potential Impact On Chile’S Export Industry," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(1).
    8. Mr. Claudio A Paiva, 2003. "Trade Elasticities and Market Expectations in Brazil," IMF Working Papers 2003/140, International Monetary Fund.
    9. Keiko Murata & Dave Turner & David Rae & Laurence Le Fouler, 2000. "Modelling Manufacturing Export Volumes Equations: A System Estimation Approach," OECD Economics Department Working Papers 235, OECD Publishing.
    10. Rómulo A. Chumacero & Rodrigo Fuentes & Klaus Schmidt-Hebbel, 2004. "Chile’s Free Trade Agreements: How Big is The Deal?," Working Papers Central Bank of Chile 264, Central Bank of Chile.
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    Cited by:

    1. Medina, Juan Pablo & Toni, Emiliano & Valdes, Rodrigo, 2023. "The Art and Science of Monetary and Fiscal Policies in Chile," MPRA Paper 117198, University Library of Munich, Germany, revised 28 Apr 2023.
    2. Ben Naceur, Sami & Bakardzhieva, Damyana & Kamar, Bassem, 2012. "Disaggregated Capital Flows and Developing Countries’ Competitiveness," World Development, Elsevier, vol. 40(2), pages 223-237.
    3. Palazzo, Gabriel & Rapetti, Martín, 2023. "From macro to micro and macro back: Macroeconomic trade elasticities in a developing economy," Structural Change and Economic Dynamics, Elsevier, vol. 65(C), pages 223-252.
    4. Tarziján, Jorge, 2013. "The emergence of world-class companies in Chile: Analysis of cases and a framework to assess integration decisions," Journal of Business Research, Elsevier, vol. 66(10), pages 1728-1735.
    5. Medina, Juan Pablo & Soto, Claudio, 2016. "Commodity prices and fiscal policy in a commodity exporting economy," Economic Modelling, Elsevier, vol. 59(C), pages 335-351.

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    Keywords

    WP; demand; elasticity; export; import; trade;
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