Estimating of Import Demand Function in Egypt

نوع المستند : المقالة الأصلية

المؤلف

Assistant Professor of Economics- International Economic Relations Center – Institute of National Planning.

المستخلص

This study aims to estimate the determinants of import demand in Egypt, utilizing the ordinary least squares (OLS) approach and the vector error correction model (VECM) for the period (1982-2021). The results of the study indicate a positive and significant relationship between the demand for imports and exports, evident in both short and long-term perspectives. Additionally, a negative and significant relationship is identified between import demand and the real effective exchange rate. These findings carry implications for Egypt's balance of payments. The surge in imports, driven by the concurrent increase in exports, serves as a crucial source of foreign exchange, enabling the country to meet fundamental needs for food commodities and production requirements. However, a caveat is noted: if the growth rate of imports surpasses that of real income, it may lead to a deterioration in the trade balance. In conclusion, the paper emphasizes the necessity to foster export-led growth and underscores the importance of carefully considering alternative strategies, particularly given the limited impact of currency depreciation on import dynamics. Furthermore, the study recommends monitoring inflation trends to gain insights into potential shifts in consumer preferences towards imported goods.

الكلمات الرئيسية

المراجع

  • References

    • Abrishami, H. and Mehrara, M. (2002) ARDL Approach to The Demand for Disaggregate Import: The Case of Iran. Iranian Economic Review, 7(7), pp. 87-109.
    • Adams & Metwally (2021) Testing for The Marshall–Lerner Condition in Egypt: An Empirical Analysis, African Journal of Economic and Management Studies, Vol. 12 No. 1, 2021 pp. 151-170, Emerald Publishing, https://www.emerald.com/insight/2040-0705.htm
    • Agbola, Frank (2009) Aggregate Imports and Expenditure Components in the Philippines: An Econometric Analysis, Indian Economic Review, New Series, Vol. 44, No. 2 (July-December 2009), pp. 155-170. https://www.jstor.org/stable/29793938
    • Baek, J. (2015). Empirical Evidence on Korea’s Import Demand Behavior Revisited. Research in Applied Economics, 7(2), pp. 11-20.
    • Bakari, S., & Mabrouki, M. (2017). Impact of exports and imports on economic growth: new evidence from Panama. Journal of Smart Economic Growth, 2(1), 67-79.
    • Chen, SW. (2008). Long run aggregate Import Demand Function in Taiwan:  An ARDL Bounds Testing approach. Applied Economics Letters, 15, pp. 731-735.
    • Dutta, D. & Ahmed, N.  (2004). An Aggregate Import Demand Function for India:  A Co-Integration Analysis. Applied Economic Letter, 11(10), pp. 607-613.
    • Englama, A.; Oputa, N. ; Sanni, G.  K.; Yakub, M.  U.; Adesanya, O.  & Sani, Z.  (2013). An Aggregate Import Demand Function for Nigeria:  An Auto-Regressive Distributed Lag (ARDL) Approach. Economic and Financial Review, 51 (3)
    • Fukumoto, M. (2012). Estimation of China's disaggregate import demand functions. China Economic Review, 23(2).
    • Hossain, S., Sen, K. K., Abedin, T., & Chowdhury. M. S. R. (2019). Revisiting the import demand function: a comparative analysis. Dynamic econometric models, 9, 5-27. DOI:10.12775/DEM.2019.00
    • Hussain, Majeed, 2007. "Estimating Long-Run Elasticities of Jordanian Import Demand Function: 1980-2004 An Application of Dynamic OLS," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(2), pages 171-178.
    • Ibrahim, M., (2017) An Examination of the Merchandise Imports Demand Function for Egypt, Applied Economics and Finance, Vol.4, No. 2. https://redfame.com/journal/index.php/aef/article/view/1969/2245
    • Jiranyakul, K., "Exchange Rate Uncertainty and Import Demand of Thailand," Asian Economic and Financial Review, Vol. 3, No. 10, pp. 1269-1280, 2013. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2224398
    • Khalil, Ahmed (2013) Estimating the determinants of demand for Egyptian imports, Trade and Finance Journal, No. 3, pp. 121-138 http://search.mandumah.com/Record/650792
    • Narayan, S. & Narayan, D. (2010). Estimating Import and Export Demand Elasticities for Mauritius and South Africa. Australian Economic Papers, 49(3), pp. 241-252.
    • Nomfundo & Nicholas (2020) The Determinants of Import Demand: A Review of International Literature, AUDŒ, Vol. 16, no. 5/2020, pp.101-117.
    • Rashwan & Elshamy (2014) An Aggregate Import Demand Function for Egypt: A Cointegration Approach, Vol 76, No. 5; May https://www.researchgate.net/publication/327262151
    • Sayed, Hanan (2022) Determinants of Egypt’s Food Imports Based on Vector Error-Correction Model (VECM), European Journal of Sustainable Development (2022), 11, 3, 137-148.
    • Shehab, Mohamed (2012) Determinants of demand for total imports of the Arab Republic of Egypt during The period 1980 - 2010: using cointegration analysis and error correction model, Al-Nahda Journal, No. 13, pp. 67-108, http://search.mandumah.com/Record/220680
    • Shuaibu, M. I. & Fatai, B. O. (2014). On the Stability of Nigeria’s Import Demand: Do Endogenous Structural Breaks Matter? Journal of Reviews on Global Economics, 3, pp. 228-240.
    • Uzunoz, M. & Akcay, Y.  (2009). Factors Affecting the Import Demand of Wheat in Turkey. Bulgarian Journal of Agricultural Science, 15(1), pp. 60-66
    • Vacu, N.P., & Odhiambo, N.M. (2022). Examining the determinants of import demand in Tanzania: An ARDL approach. International Entrepreneurship Review, 8(1), 65-75. https://doi.org/10.15678/ IER.2022.0801.05
    • Yahia, A. F. (2015). An econometric estimation and evaluation of the import function in the Libyan economy. Journal of Economics, Business and Management, 3(10), 995-998. http://dx.doi.org/10.7763/JOEBM.2015.V3.322
    • Zhou, Y. & Dube, S. (2011). Import Demand Functions: Evidence from CIBS. Journal of economic development, 36(4), pp. 73-96.

ملفات

شارك

إرسال الاستشهاد إلى

الإحصائيات