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An empirical investigation of the trade benefit function

Authors
Journal
Economics Letters
0165-1765
Publisher
Elsevier
Volume
119
Issue
2
Identifiers
DOI: 10.1016/j.econlet.2013.01.008
Keywords
  • Trade Benefit Functions
  • Import Share Systems
  • Numerical Inversion

Abstract

Abstract We introduce new definition and estimation procedures of trade benefit functions that allow researchers to generate estimable import share functions. The method is based on the work of Chau and Färe, while it is more general in permitting the estimation of Hicksian import share systems, which are explicit in an unobservable variable but may lack a closed-form representation in terms of observable variables. An empirical application demonstrates the feasibility of the proposed method.

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