Estimating trade elasticities for Denmark


I papiret estimeres substitutionselasticiteten mellem indenlandsk producerede og importerede varer.


We estimate the elasticity of substitution between domestically produced goods and imported goods. In particular, we estimate the homeforeign elasticity of substitution - also known as the macroelasticity. We use a methodological approach based on Feenstra et al. (2018), in which we distinguish the elasticity of substitution of imported goods from different countries of origin (microelasticity) and the macroelasticity. The median microelasticity is 2.97, while we estimate the macroelasticity to be 1.81.