Supply Capacity, Vertical Specialization and Tariff Rates: The Implications for Aggregate U.S. Trade Flow Equations / Menzie D. Chinn.

Format:

Book

Author/Creator:

Chinn, Menzie D.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w11719.

NBER working paper series no. w11719

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Supply Capacity, Vertical Specialization and Tariff Rates

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2005.

Summary:

This paper re-examines aggregate and disaggregate import and export demand functions for the United States. This re-examination is warranted because (1) income elasticities are too high to be warranted by standard theories, and (2) remain high even when it is assumed that supply factors are important. These findings suggest that the standard models omit important factors. An empirical investigation indicates that the rising importance of vertical specialization combined with decreasing tariffs rates explains some of results. Accounting for these factors yields more plausible estimates of income elasticities, as well as smaller prediction errors.

Notes:

Print version record

October 2005.