The name is absent



Table 7 Increase in US trade due to policy liberalization, declining transportation costs, and GDP

growth, 1980 to 2005 (billions of US dollars)

Partner/world estimates

Exports

Imports

Total trade

Trade with 17 partner estimates

Observed US merchandise trade in 1980 with 17 partners

166

173

338

Observed US merchandise trade in 2004 with 17 partners

707

1294

2001

Observed increase in trade from 1980 to 2004 in merchandise trade

542

1121

1663

Trade growth explained by GDP growth and income elasticities of trade

413

970

1384

Trade growth explained by appreciation of US dollar and price elasticities of trade

-53

77

24

Trade growth not explained by GDP growth or exchange rate change

181

74

255

Trade growth explained by traditional trade policy liberalization (i.e., tariffs) (Scenario 2)

115

59

174

Trade growth explained by lower transport costs (Scenario 3)

9

19

28

Trade growth explained by nontariff barrier cuts (Scenario 5)

84

132

216

Trade with world estimates (extrapolated from above)

Observed US merchandise trade in 1980 with 17 partners

221

253

474

Observed US merchandise trade in 2004 with 17 partners

818

1525

2343

Observed increase in trade from 1980 to 2004 in merchandise trade

597

1272

1869

Trade growth explained by GDP growth and income elasticities of trade

447

1152

1599

Trade growth explained by appreciation of US dollar and price elasticities of trade

-64

88

24

Trade growth not explained by GDP growth or exchange rate change

215

32

246

Trade growth explained by traditional trade policy liberalization (i.e., tariffs) (Scenario 2)

135

69

204

Trade growth explained by lower transport costs (Scenario 3)

11

22

33

Trade growth explained by nontariff barrier cuts (Scenario 5)

99

155

253

Memorandum (GDP growth rate, 1980 to 2004):

Growth (percent)

Weighted average (by 1990 GDP) of 18 country GDP growth

312

World GDP growth

253

Memorandum (income and price elasticities):

Export

Import

Price elasticities (Kee, Nicita, and Olarreaga 2004)

-1.17

-1.30

Income elasticities (Hooper, Johnson, and Marquez 2000)

0.80

1.80

Memorandum (exchange rate change):

Change in index value

Real equilibrium exchange rate change, 1980-2004

10.88

Notes: Exchange rate effect is calculated by: [10.88∕86.88]*[relevant price elasticity]*[relevant one-way US 1992 trade]—{times -1 for imports}

Sources: Hummels (2007); TRAINS Database via WITS (2008); UN Comtrade Database via WITS (2008); WTO (2008); Kee, Nicita, and Olarreaga (2004);

Hooper, Johnson, and Marquez (2000); IMF International Financial Statistics, November 2008; IMF World Economic Outlook, October 2008; authors'
calculations.

25



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