Demand for Apparel Imports in the United States

Abstract

A single-equation import demand model was developed to estimate U.S. demand for apparel imports from developed and developing countries. Separate analyses were done for each region usingannualdatafrom 1974 to 1988. The independent variables were U.S. apparel expenditures, prices of apparel imports relative to domestic prices, and trend. They had a significant impact on apparel imports in most instances. The own-price elasticities of demandfor imports varied by import source. They rangedfrom −0.61 to −0.81for the developing countries andfrom −2.35 to −2.57for the developed countries. In contrast, expenditure elasticities were greater than unity for both regions. The sign of the coefficient of the trend variable was positive for developed countries, whereas it was negative for developing countries, which is consistent with the implementation of the Multifiber Arrangement.