ESTIMATING LONG-RUN ELASTICITIES OF JORDANIAN IMPORT DEMAND FUNCTION: 1980-2004 AN APPLICATION OF DYNAMIC OLS

Applied Econometrics and International Development, 2007, vol. 7, issue 2, pages 171-178

Abstract: The paper estimates the long-run elasticities of import demand in Jordan over the period 1980-2004. The Engle-Granger test of co-integration, fails to find favor of a long-run relationship among variables associated with an import demand. Furthermore, the recently prescribed Stock-Watson Dynamic OLS (1993) procedure, is employed to derive long-run relative price and income elasticities. Results reveal that both relative price and income elasticity was -0.55 and 0.84 respectively which affect import demand significantly. Interestingly, the findings have implications explaining Jordanian import demand, in the long-run.

Keywords: Import; Elasticity; Long run; dynamic OLS. Jordan (search for similar items in EconPapers)
JEL-codes: F14 C51 (search for similar items in EconPapers)
Date: 2007
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