Understanding the evolution of trade deficits: trade elasticities of industrialized countries

Crane, Leland D.; Crowley, Meredith A.; Quayyum, Saad

Journal Article

Understanding the evolution of trade deficits: trade elasticities of industrialized countries

Abstract: In this article, the authors present updated trade elasticities?measures of how much imports and exports change in response to income and price changes?for the U.S. and six other industrialized countries, collectively known as the Group of Seven. They find that the imports and exports of these countries are slightly more responsive to changes in a country?s total income over a period that ends in 2006, compared with a period that ends in 1994.

Keywords: Balance of trade; Trade; Exports;