Import Price Uncertainty, Production Decisions, and Relative Factor Shares

REVIEW OF INTERNATIONAL ECONOMICS MS#6256, January 31,1998

Posted: 24 Mar 1998

See all articles by Ulrich Kohli

Ulrich Kohli

Swiss National Bank

Elie Appelbaum

York University - Schulich School of Business

Abstract

In this paper, we estimate the effects of import-price uncertainty on factor income in Switzerland. We use the production-theory approach to derive the import demand function from an expected utility maximization problem, treating imports as an input to the technology. The model is also used to test for risk aversion and to assess the impact of uncertainty on the volume of imports and gross output. We find evidence that, for most years, labor has been relatively more vulnerable to uncertainty than capital.

JEL Classification: F11, D33, D81, C51

Suggested Citation

Kohli, Ulrich and Appelbaum, Elie, Import Price Uncertainty, Production Decisions, and Relative Factor Shares. REVIEW OF INTERNATIONAL ECONOMICS MS#6256, January 31,1998 , Available at SSRN: https://ssrn.com/abstract=69374

Ulrich Kohli (Contact Author)

Swiss National Bank ( email )

Borsenstrasse 15
CH-8022 Zurich
Switzerland

Elie Appelbaum

York University - Schulich School of Business ( email )

4700 Keele Street
Toronto, Ontario M3J 1P3
Canada

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