Have U.S.-Japan Trade Agreements Made a Difference?

Byron Gangnes () and Craig Parsons ()
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Craig Parsons: Yokohama National University

No 08-2004, Working Papers from Singapore Management University, School of Economics

Abstract: The few existing empirical studies of U.S.-Japan trade agreements have relied primarily on descriptive statistics or univariate time series methods. We conduct a more powerful test by evaluating agreements in the context of well-specified econometric models. Consistent with trade theory, import demand is modeled as a cointegrating relationship with income and relative price variables, where a trade agreement may cause a structural break in the cointegrating vector. In several cases, we find evidence that market-opening trade agreements may have increased the volume of Japanese imports, while other agreements appear to have had no significant impact.

Keywords: structural break tests; U.S.-Japan trade agreements; import promotion policies (search for similar items in EconPapers)
JEL-codes: C32 F13 F14 (search for similar items in EconPapers)
Pages: 29 pages
Date: 2004-03
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Published in SMU Economics and Statistics Working Paper Series

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Related works:
Journal Article: Have US–Japan Trade Agreements Made a Difference? (2007)
Working Paper: Have US-Japan Trade Agreements Made a Difference? (2004)
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