South African Journal of Economic and Management Sciences
On-line version ISSN 2222-3436
Print version ISSN 1015-8812
OGUNDEJI, AA; JOOSTE, A and UCHEZUBA, D. Econometric estimation of Armington elasticities for selected agricultural products in South africa. S. Afr. j. econ. manag. sci. [online]. 2010, vol.13, n.2, pp.123-134. ISSN 2222-3436.
Price transmission behaviour is used to model the impacts of different trade regimes; if this behaviour is not modelled correctly, the trade impacts can be either under- or overestimated. Due to the lack of elasticities of substitution pertaining to selected imported and domestically produced agricultural products in South Africa, 'Armington' elasticities, using quarterly data from 1995-2006 and three different models, based on the time series properties of the data, are estimated in this paper. Considering the long-run elasticity results, soyabeans (whether broken or not) and meat of bovine animals (frozen) are the most sensitive import products, followed by maize, meat of bovine animals (fresh or chilled), sunflower seeds, and wheat and meslin. Regarding the short-run elasticity, soyabeans are the most sensitive import product, followed by meat of bovine animals (fresh or chilled); meat of swine (fresh, chilled or frozen) is the least sensitive import product.