Search results

1 – 1 of 1
Per page
102050
Citations:
Loading...
Available. Open Access. Open Access
Article
Publication date: 31 December 2015

TZU HANYANG and HAN PANGSU

In the last two decades, the dependence of Taiwan’s manufacturing production on imported intermediate inputs has steadily risen. Meanwhile, the market share of imported consumable…

615

Abstract

In the last two decades, the dependence of Taiwan’s manufacturing production on imported intermediate inputs has steadily risen. Meanwhile, the market share of imported consumable manufacture products has also increased. The steady rise of both import shares may not be explained by price fact or since the relative import prices have shown no decreasing trend. The scenario of constantly buying more imported goods when they are not cheaper can be treated as a preference change in favor of imported goods, which may be caused by the popularity of outsourcing, increasing product varieties and persistent trade barriers, as literatures indicated. Traditional macroeconomic models primarily consider the price mechanism in their import demand estimates, with no concern for changes in import preferences. Neglecting changing import preferences in a rapid globalization environment may yield biased empirical results. In this article, we incorporate the import preference factor into a single-country Computable General Equilibrium (CGE) model and use it firstly to quantify the scale of preferences change and then to test how the preferences change affects the effects of trade policy. The empirical results with and without the concern of import preferences change are compared to yield the scale of bias caused by neglecting the change.

Details

Journal of International Logistics and Trade, vol. 13 no. 3
Type: Research Article
ISSN: 1738-2122

Keywords

1 – 1 of 1
Per page
102050