Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/126306
Authors: 
Saikkonen, Liisa
Year of Publication: 
2015
Series/Report no.: 
WIDER Working Paper 2015/104
Abstract: 
The objective of this paper is to estimate transformation and Armington substitution elasticities for South African trade. We use linear methods to estimate elasticities without growth factors. We then employ a non-linear system of equations to estimate Armington import elasticities and related growth factors. Using the linear estimation method, we find positive (0.386-1.379) short-run Armington substitution elasticities for most studied industries. Moreover, positive transformation elasticities for exports contradict our assumption that increased relative export prices result in increased exports. The results of the non-linear estimation suggest that growth affects imports more than domestic consumption of domestic production in the manufacturing industry.
Subjects: 
South Africa
trade
Armington elasticity
constant elasticity of transformation
JEL: 
F1
ISBN: 
978-92-9230-993-0
Document Type: 
Working Paper

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