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The Functional Form of Import Demand: The Case of UK Motor Vehicle Imports, 1980‐90

Journal of Economic Studies

ISSN: 0144-3585

Article publication date: 1 March 1993

164

Abstract

In the absence of any theoretical guidance, a solution to the question of what is the appropriate functional form for an import demand model can only be found empirically. Examines this question in the context of UK motor vehicle imports by applying a range of tests of functional form to two, alternatively specified, import demand models: the “traditional” price‐income model incorporating the popular but restrictive partial adjustment mechanism and a cost‐expenditure model that employs a less restrictive lag structure. Finds, principally that the commonly imposed linear or log‐linear functional forms cannot be rejected in relation to the price‐income specification, but there is some evidence that neither functional form may be appropriate in relation to the theoretically sounder cost‐expenditure model of import demand.

Keywords

Citation

King, A. (1993), "The Functional Form of Import Demand: The Case of UK Motor Vehicle Imports, 1980‐90", Journal of Economic Studies, Vol. 20 No. 3. https://doi.org/10.1108/01443589310040396

Publisher

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MCB UP Ltd

Copyright © 1993, MCB UP Limited

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