Hentschel Imports and Growth in Highly Indebted Countries

An Empirical Study
Erscheinungsjahr 2012
ISBN: 978-3-642-46770-7
Verlag: Springer
Format: PDF
Kopierschutz: 1 - PDF Watermark

E-Book, Englisch, 209 Seiten, eBook

Reihe: Studies in International Economics and Institutions

A real imports of capital and intermediate goods declined
sharply for highlyindebted countries in the 1980s, these
economies were faced with the need tosubstitute previously
imported factors of production with domestic capital and
labor. The study empirically analyzes the degree of import
dependence of twelve developing countries. Estimates of the
short-run elasticity of substitution characterize both
imported capital and intermediate goods to behave like
complements in the production process in the developing
countries. Long-run substitution elasticites differ
considerably among the group of economies, especially for
imported machinery and equipment. The results indicate that
inward-oriented strategies have not achieved the aim of
reducing the import dependence of the developing economies.
In order to visualize theimplications of the differing
degree of import dependence, a partial equilibrium
econometric model is used to analyze the reaction of the
trade account on external shocks and domestic policies in
Columbia and Ecuador. Simulations show that the dependence
on imported production means can transform an "adjustment
with growth" of the external account intoan "adjustment or
growth" controversy.

Zielgruppe

Research

Autoren/Hrsg.

Hentschel, Jesko

Inhaltsverzeichnis

1. Introduction.- 1.1. The debt crisis, imports, and growth.- 1.2. Structure of the study.- 2. The importance of imported factors of production in developing countries.- 2.1. Introductory remarks.- 2.2. The composition of imports.- 2.3. Factors impeding perfect import substitutability.- 2.4. Capital goods.- 2.5. Intermediate goods.- 2.6. Development strategies and the role of imports.- 2.7. Summary.- 3. Import models: issues and problems.- 3.1. Introduction.- 3.2. The theoretical background: imports and growth.- 3.3. The standard import function, foreign exchange availability, and disaggregate import analyses.- 3.4. Empirical studies of imports as factors of production in developing countries.- 3.5. Concluding remarks.- 4. Macroeconomic production functions and elasticities of substitution between imported and domestic factors of production.- 4.1. Introduction.- 4.2. Aggregate production functions and the elasticity of substitution.- 4.3. The nested production function.- 4.4. Summary.- 5. Estimation of elasticities of substitution between domestic and imported means of production.- 5.1. Introductory remarks.- 5.2. Measurement of the domestic price of imported goods.- 5.3. Imported and domestically produced capital goods.- 5.4. Imported intermediate goods.- 5.5. Summary and interpretation of the empirical results.- 6. Imports, growth, and the trade balance: two case studies.- 6.1. Basic remarks about the framework.- 6.2. The Columbian model.- 6.3. The Ecuadorian model.- 6.4. Concluding remarks about the simulations.- 7. Conclusion.- 7.1. Summary of findings.- 7.2. Import vulnerability reconsidered.- Appendices.- A. Statistical tables.- B. The cost function and conditional factor demands for a CES production function.- B.1. Derived factor demands.- B.2. The cost function.- C. Data sources and computational notes.- C.1. Industrial production and price statistics.- C.2. Trade data.- C.3. National income accounting statistics.- C.4. Specific variables used in Chapter 5.- C.4.1. Implicit average effective import taxes.- C.4.2. Real import capacity.- C.4.3. Interest rates.- C.5. Variable defmitions and sources, Chapter 6.- C.6. Computational notes.- References.