US Import Demand for Softwood Plywood: A Cointegration Approach

Abstract

Abstract In this article, we present a model and estimates of US import demand for softwood plywood from Brazil, Canada, Chile, and China using a cointegration framework. We find evidence of long-run cointegration for time series variables in US import demand functions from Brazil, Canada, and China but not from Chile. The short-run own price elasticity estimates of US import demand from Brazil, Canada, Chile, and China are at –0.53, –0.80, –0.82, and –0.91, respectively. The estimates of long-run price elasticity suggest that US import demand for softwood plywood from the three countries is more sensitive to softwood plywood price change.