Estimating Trade Equations from Aggregate Bilateral Data

CEPR Discussion Paper Series Number 1970

Posted: 9 Feb 1999

See all articles by Tamim Bayoumi

Tamim Bayoumi

International Monetary Fund (IMF); Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: September 1998

Abstract

Bilateral data on 420 merchandise trade flows between 21 industrial countries are used to estimate standard trade equations. The data set of over 11,000 observations allows the underlying elasticities to be estimated with considerable precision. Remarkably, a single specification appears to explain behaviour across these countries in spite of the large number of individual flows analysed. The results indicate a powerful long-run effect from supply on exports. Also, the real exchange rate elasticity depends upon the behaviour of third country exchange rates, there is evidence of pricing to market and of a J-curve.

JEL Classification: F11. F12. F17

Suggested Citation

Bayoumi, Tamim, Estimating Trade Equations from Aggregate Bilateral Data (September 1998). CEPR Discussion Paper Series Number 1970. Available at SSRN: https://ssrn.com/abstract=141313

Tamim Bayoumi (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-6333 (Phone)
202-623-4795 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
629
PlumX Metrics