Abstract
This study empirically estimates some critical parameters of the aggregate import demand function for Bangladesh for Bangladesh using quarterly time series data and by applying the Johansen–Juselius multivariate cointegration technique. Cointegration results indicate that the import demand function is dominated by income and relative prices. The income elasticity is significantly positive and exceeds unity indicating that aggregate imports are to be considered as ‘luxury’ goods. The effect of the relative price variable is significantly negative but its elasticity coefficient is less than unity.
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