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Effects of Trade Liberalization on Domestic Prices: Some Evidence from Tunisian Manufacturing
Jönköping University, Jönköping International Business School, JIBS, Economics.ORCID iD: 0000-0002-7902-4683
2007 (English)In: International Review of Economics, ISSN 1865-1704, E-ISSN 1863-4613, Vol. 54, no 1, 148-175 p.Article in journal (Refereed) Published
Abstract [en]

This paper presents estimates of the competitive effects of trade liberalization on domestic pricing behaviour of Tunisian manufacturing industries. The theoretical framework is based on a dynamic flexible adjustment model of price determination in a small open economy. It investigates the process of adjustment in price level toward a desired level. The adjustment process is both industrial and time-specific. The empirical results show that, in the long run, domestic price responds greatly to import penetration, followed by demand pressure. There was a negative effect from import competition on domestic price. Trade policy is a viable policy option to promote competitiveness.

Place, publisher, year, edition, pages
Springer, 2007. Vol. 54, no 1, 148-175 p.
Keyword [en]
dynamic model, domestic prices, trade liberalization, panel data, speed of adjustment, Tunisia
National Category
Economics
Identifiers
URN: urn:nbn:se:hj:diva-36779DOI: 10.1007/s12232-007-0008-3Local ID: IHHövrigtISOAI: oai:DiVA.org:hj-36779DiVA: diva2:1128654
Available from: 2017-07-27 Created: 2017-07-27 Last updated: 2017-07-27Bibliographically approved

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