Import price elasticities: reconsidering the evidence

Hélène Erkel-Rousse and Daniel Mirza ()

Canadian Journal of Economics, 2002, vol. 35, issue 2, pages 282-306

Abstract: Recent economic geography and trade empirical studies based on monopolistic competition suggest high levels of trade price elasticities (between 3 and 11). However, price elasticity estimations in trade equations using unit values as price proxies usually lead to lower values of around unity. We show that those inconclusive results may be due to some misspecification in these equations as well as measurement errors in prices. When suitable instrumental variables are used, within a panel of industrialized countries, we obtain high price elasticities, the majority ranging from 1 to 13. The highest estimates correspond to industries producing homogeneous goods.

JEL-codes: C2 C3 F1 (search for similar items in EconPapers)
Date: 2002
View citations in EconPapers

Downloads: (external link)
http://economics.ca/cgi/xms?jab=v35n2/05.pdf Full text (application/pdf)
Available to subscribers only. Alternative access through JSTOR and Ingenta.

Related works:
Working Paper: Import Price-Elastcities: Reconsidering the Evidence (2000)
Working Paper: Import Price-Elasticities: Reconsidering the Evidence (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:cje:issued:v:35:y:2002:i:2:p:282-306

Ordering information: This journal article can be ordered from
http://economics.ca/en/membership.php

Access Statistics for this article

Canadian Journal of Economics is edited by David Green

More articles in Canadian Journal of Economics from Canadian Economics Association
Address: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
Contact information at EDIRC.
Series data maintained by Prof. Werner Antweiler ().