Sadegh Bakhtiari; Behnam Salem
Volume 8, Issue 31 , January 2009, , Pages 15-27
Abstract
This article aims to investigate the impacts of trade liberalization on export and import of industrial commodities through estimating of substitution elasticity of industrial commodities, in terms of two digits codes, in global markets; and also estimating of trade liberalization impact on export and ...
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This article aims to investigate the impacts of trade liberalization on export and import of industrial commodities through estimating of substitution elasticity of industrial commodities, in terms of two digits codes, in global markets; and also estimating of trade liberalization impact on export and import of industrial commodities using dummy variable.
Our estimations show that average tariff dose not effect export; the relationship between per capita capital and export is negative; elasticity of export to liberalization is 1.36 and elasticity of export to real exchnge rete is less than unit. Substitution elasticities all, except code of 37, are less than unit. Codes of 32, 37, 31, 36 and 35 have the highest export, and code of 33 has the least export.
On the side of import, the estimations are as follow: trade liberalization has negative impact on import and results of substitution elasticites are mixed. In codes of 34, 31, 32 and 35 the estimated elasticities are not significant. In codes of 38, 36, 33 and 39 the substitution elasticity is negative and in code of 37 is positive.
In general, the impact of trade liberalization on export is more than import sector. The results show that this policy has positive impact on productivity and at the same time there is a negative relationship between capital accumulation and export; and a positive relationship between capital accumulation and import. This means Iran according to Hecher- Ohlin theory has advantage in labor intensive commodities.
