Estimating the import demand function in the autoregressive distributed lag framework: The case of China

Fengbao Yin () and Shigeyuki Hamori

Economics Bulletin, 2011, vol. 31, issue 2, 1576-1591

Abstract: This paper uses the concept of cointegration for empirically analyzing the long-run relationship of China's import demand function. The analysis employs the annual data for the sample period from 1978 to 2009. The purpose of this study is to investigate and explain China's import demand functions and provide a more in-depth analysis of China's import behavior. The autoregressive distributed lag (ARDL) and dynamic ordinary least square (DOLS) techniques were used for estimating the long-run coefficients of price and income elasticities. The empirical results from ARDL bound testing approach and Johansen's method of cointegration provide strong evidence of the existence of a long-run stable relationship among the variables included both in the traditional model and the disaggregated expenditure model of import demand. In addition, the disaggregated import demand model estimated in this paper provides a complete description of the determinants of China's imports, and offers empirical results that are significantly different from those obtained in existing studies (Tang, 2003). This is an important finding for resolving the issue of trade imbalance from the perspective of China's policy formulation.

Keywords: Import Demand Function; China; ARDL Model; Dynamic OLS; Bounds Test (search for similar items in EconPapers)
JEL-codes: F4 O1 (search for similar items in EconPapers)
Date: 2011-06-05
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2011/Volume31/EB-11-V31-I2-P146.pdf (application/pdf)

Related works:
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: https://EconPapers.repec.org/RePEc:ebl:ecbull:eb-11-00136

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().