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An aggregate import demand function for greece

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Abstract

This study estimates the aggregate import demand function for Greece using annual data for the period 1951–92. There are two methodological novelties in this paper. The authors find that the variables used in the aggregate import demand function are not stationary but are cointegrated. Thus, a long-run equilibrium relationship exists among these variables during the period under study. The price elasticity is found to be close to unity in the long run. The cross-price elasticity is also found to be close to unity. Import demand is found to be highly income elastic in the long run. This implies that with economic growth, ceteris paribus, the trade deficit for Greece is likely to get worse.

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Authors and Affiliations

  1. Macquarie University, Australia

    Dipendra Sinha

  2. Instituto Tecnologico Autonomo de Mexico, Mexico

    Tapen Sinha

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  1. Dipendra Sinha
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  2. Tapen Sinha
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Sinha, D., Sinha, T. An aggregate import demand function for greece. Atlantic Economic Journal 28, 196–209 (2000). https://doi.org/10.1007/BF02298361

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