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Elasticidades de Sustitución de Importaciones para Ecuador

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  • González, Manuel
  • Wong, Sara

Abstract

This paper presents estimation of Armington Substitution Elasticities between imported and domestic goods in Ecuador at the input output level of goods classification. These estimations are intended to be used in applied general equilibrium models of the cuadorian economy that analyze the impacts of changes in trade policy on this economy. The study analyzes time series properties of the data that correspond to years 1975-2001. Estimations include dummy and trend variables. The estimates of Armington elasticities for Ecuador range between 0.317 and 2.383 for the long-run elasticities, and between 0.454 and 1.524 for the short-run ones. These values suggest that imported and domestic goods in Ecuador are far from perfect substitutes. This implies that changes in relative prices between imports and domestic goods –such as those due to trade opening or liberalization processes- would not have in some sectors dramatic impact effects in the relative composition of imports and domestic sales of domestic goods.

Suggested Citation

  • González, Manuel & Wong, Sara, 2004. "Elasticidades de Sustitución de Importaciones para Ecuador," MPRA Paper 306, University Library of Munich, Germany, revised May 2005.
    • Handle: RePEc:pra:mprapa:306
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    File URL: https://mpra.ub.uni-muenchen.de/306/1/MPRA_paper_306.pdf
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    References listed on IDEAS

    as
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    4. Phillips, Peter C B & Ouliaris, S, 1990. "Asymptotic Properties of Residual Based Tests for Cointegration," Econometrica, Econometric Society, vol. 58(1), pages 165-193, January.
    5. McDaniel, Christine A. & Balistreri, Edward J., 2002. "A Discussion on Armington Trade Substitution Elasticities," Working Papers 15856, United States International Trade Commission, Office of Economics.
    6. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    7. 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.
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    More about this item

    Keywords

    Armington Substitution Elasticities; Cointegration;

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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    This paper has been announced in the following NEP Reports:

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