The Canada-United States bilateral import demand functions: gradual switching in long-run relationships

Abstract

By estimating long-run relationships in bilateral import functions, the effects of the Canada-US Free Trade Agreement is analysed. We also incorporate the gradual switching model into the import function to capture the phased tariff reductions. The result shows that the free trade agreement made both countries sensitive to domestic and foreign prices and insensitive to the domestic income.

Export Conditions of the Chinese Textile Industry: An Analysis in Comparison with Selected ASEAN Countries

“…Johnston and Chinn [20] find a unique cointegrating relationship within import demand function by excluding agricultural products and fuels for the 1973-95 period in the US, whereas Chinn [21] obtains evidence of a cointegrating relationship only when computers are excluded. Konno and Fukushige [22] estimate the bilateral US-Canada long-run import demand function in aggregate level taking into account the effects of Canada-US Free Trade Agreement. The results show that the free trade agreement made the US sensitive to import prices and insensitive to its domestic income.…”

Import demand response of MFA apparel/nonapparel fibers and cottons in the United States: a case study of China and Hong Kong

“…Johnston and Chinn (1996) found a unique cointegrating relationship within import demand function by excluding agricultural products and fuels for the 1973-1995 period in the United States, whereas Chinn (2005) obtained evidence of a cointegrating relationship only when computers are excluded. Konho and Fukushige (2002) estimated the bilateral USCanada long-running import demand function in aggregate level taking into account the effect of the Canada-US free trade agreement. The result showed that the free trade agreement made the United States sensitive to import prices and insensitive to its domestic income.…”

Regional integration and dynamic adjustments: Evidence from gross national product functions for Canada and the United States

“…Magee (2008) showed that the effects of regional agreements on bilateral trade flows are gradual and that traders had anticipated the implementation of CUSTA. Konno and Fukushige (2002) used the gradual switching approach to analyze the impact of CUSTA on U.S. and Canadian bilateral import functions. The impacts of RTAs go beyond trade flows and may vary from one country to another.…”