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Trade Liberalization and Import-Demand Behavior in Bangladesh, 1974–2008
- The Journal of Developing Areas
- Tennessee State University College of Business
- Volume 47, Number 2, Fall 2013
- pp. 387-416
- 10.1353/jda.2013.0022
- Article
- Additional Information
From the early 1980s onwards, Bangladesh has undertaken a series of trade-liberalization measures. In combination with the steady rise in real income over the past two-and a half decades, these measures have raised the country’s import-orientation and brought structural change in the composition of imports in favor of consumer goods and materials for consumption. This paper investigates import-demand behavior in Bangladesh within the Autoregressive-Distributed-Lag (ARDL) modeling framework using annual data for the period 1974–2008. The empirical results suggest the presence of a well-behaved import-demand function, in the senses that (1) Bangladesh’s imports are income-elastic and price-inelastic and (2) there is no evidence of instability in the Bangladesh import-demand relationship.