imposed on access to the U.S. market by most of the leading exporters as a result of the ATC.
The estimated coefficient for exchange rate shows that a unit decrease in the exchange
rate of local currency to the dollar will result in an increase of $ 40.05 million in value of textile
imports and $2,827.24 million in the value of apparel imports, respectively to the U.S. Indeed,
depreciation of an exporting country’s currency relative to the dollar makes the exporting
country’s textiles and apparel products cheaper in the importing country’s market, leading to
increased trade flows. The variable for distance shows a negative and significant relationship at
the 1% level with import values for both textiles and apparel, although the parameters are not
sensitive to imports of textiles and apparel. The results explain the possibility that as distance
between the U.S. and its trading partners increases, the value of imported textiles and apparel
declines.
Implications and Concluding Comments
Although the popular press and textile and apparel interest groups decry the patterns of
consistent imports of products from abroad, to date, no empirical study has been conducted to
explain the pattern of textiles and apparel trade between the U.S and its trading partners. A
major objective of this study is to fill that gap by providing consistent economic measures to
explain some of the key underlying factors supporting recent textiles and apparel trade flows into
the U.S. Despite some limitations, such as data paucity, this study demonstrates that the
traditional gravity model can be parameterized effectively by using time series and cross-section
data. It is clear from the gleaned results that modeling trade in textiles and apparel between the
U.S. and its major trading partners provides consistent and efficient results.
A nation’s aggregate output and its per unit productivity serve as important determinants
of textiles and apparel trade with the U.S., indicating that countries that produce more quality
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