MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS
ABSTRACT Objective: This study aimed to determine which model best captures the behaviour of rice imports during the North America Free Trade Agreement (NAFTA) regime (1994–2018). Methodology Mexican demand for rice imports is estimated with Autoregressive Distributed Lag Model (ARDL) and Nonlinear Autoregressive Distributed Lag Model (NARDL), both with and without structural change and outliers. Results It starts with the ARDL and NARDL models, obtaining non-cointegration, as well as diagnosis and specification problems. Subsequently an ARDL model is proposed with structural change and outliers, which represents an improvement but still has specification problems. Finally, the best model is obtained incorporating non-linearity. Limitations/Implications It is a study for a specific grain, so the results obtained are only valid for rice imports. Nevertheless, it must be considered that it is a basic grain. Moreover, a new methodology is used to estimate the import demand function. Findings There is evidence of an asymmetric response of rice imports to fluctuations in economic activity and the exchange rate in the short run, and only in the long run for the latter. An increase in rice imports with NAFTA is also confirmed, as well as two extraordinary variations of rice imports during the study period. Keywords Rice imports; ARDL; NARDL; structural change; outliers
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oai:ojs.pkp.sfu.ca:article19472021-09-21T14:37:01Z MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS Mexican demand for rice imports (Oryza sativa L.) during NAFTA: evidence from a NARDL model with structural change and outliers Valencia-Romero, Ramón Martinez-García, Miguel A. Sánchez-Bárcenas , Horacio Ríos-Bolívar, Humberto Rice imports; ARDL; NARDL; structural change; outliers. Rice imports; ARDL; NARDL; structural change; outliers ABSTRACT Objective: This study aimed to determine which model best captures the behaviour of rice imports during the North America Free Trade Agreement (NAFTA) regime (1994–2018). Methodology Mexican demand for rice imports is estimated with Autoregressive Distributed Lag Model (ARDL) and Nonlinear Autoregressive Distributed Lag Model (NARDL), both with and without structural change and outliers. Results It starts with the ARDL and NARDL models, obtaining non-cointegration, as well as diagnosis and specification problems. Subsequently an ARDL model is proposed with structural change and outliers, which represents an improvement but still has specification problems. Finally, the best model is obtained incorporating non-linearity. Limitations/Implications It is a study for a specific grain, so the results obtained are only valid for rice imports. Nevertheless, it must be considered that it is a basic grain. Moreover, a new methodology is used to estimate the import demand function. Findings There is evidence of an asymmetric response of rice imports to fluctuations in economic activity and the exchange rate in the short run, and only in the long run for the latter. An increase in rice imports with NAFTA is also confirmed, as well as two extraordinary variations of rice imports during the study period. Keywords Rice imports; ARDL; NARDL; structural change; outliers Objective: This study aimed to determine which model best captures the behaviour of rice imports during the North America Free Trade Agreement (NAFTA) regime (1994–2018). Methodology: Mexican demand for rice imports is estimated with Autoregressive Distributed Lag Model (ARDL) and Nonlinear Autoregressive Distributed Lag Model (NARDL), both with and without structural change and outliers. Results: It starts with the ARDL and NARDL models, obtaining non-cointegration, as well as diagnosis and specification problems. Subsequently an ARDL model is proposed with structural change and outliers, which represents an improvement but still has specification problems. Finally, the best model is obtained incorporating non-linearity. Limitations/Implications: It is a study for a specific grain, so the results obtained are only valid for rice imports. Nevertheless, it must be considered that it is a basic grain. Moreover, a new methodology is used to estimate the import demand function. Findings: There is evidence of an asymmetric response of rice imports to fluctuations in economic activity and the exchange rate in the short run, and only in the long run for the latter. An increase in rice imports with NAFTA is also confirmed, as well as two extraordinary variations of rice imports during the study period. Colegio de Postgraduados 2021-09-15 info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion application/pdf https://revista-agroproductividad.org/index.php/agroproductividad/article/view/1947 10.32854/agrop.v14i8.1947 AgroP; 2021: EARLY ACCESS (Vol. III) Agro Productividad; 2021: EARLY ACCESS (Vol. III) 2594-0252 2448-7546 spa https://revista-agroproductividad.org/index.php/agroproductividad/article/view/1947/1662 Derechos de autor 2021 Agro Productividad |
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Valencia-Romero, Ramón Martinez-García, Miguel A. Sánchez-Bárcenas , Horacio Ríos-Bolívar, Humberto |
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Valencia-Romero, Ramón Martinez-García, Miguel A. Sánchez-Bárcenas , Horacio Ríos-Bolívar, Humberto MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
author_facet |
Valencia-Romero, Ramón Martinez-García, Miguel A. Sánchez-Bárcenas , Horacio Ríos-Bolívar, Humberto |
author_sort |
Valencia-Romero, Ramón |
title |
MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
title_short |
MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
title_full |
MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
title_fullStr |
MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
title_full_unstemmed |
MEXICAN DEMAND FOR RICE IMPORTS (ORYZA SATIVA L.) DURING NAFTA: EVIDENCE FROM A NARDL MODEL WITH STRUCTURAL CHANGE AND OUTLIERS |
title_sort |
mexican demand for rice imports (oryza sativa l.) during nafta: evidence from a nardl model with structural change and outliers |
description |
ABSTRACT
Objective:
This study aimed to determine which model best captures the behaviour of rice imports during the North America Free Trade Agreement (NAFTA) regime (1994–2018).
Methodology
Mexican demand for rice imports is estimated with Autoregressive Distributed Lag Model (ARDL) and Nonlinear Autoregressive Distributed Lag Model (NARDL), both with and without structural change and outliers.
Results
It starts with the ARDL and NARDL models, obtaining non-cointegration, as well as diagnosis and specification problems. Subsequently an ARDL model is proposed with structural change and outliers, which represents an improvement but still has specification problems. Finally, the best model is obtained incorporating non-linearity.
Limitations/Implications
It is a study for a specific grain, so the results obtained are only valid for rice imports. Nevertheless, it must be considered that it is a basic grain. Moreover, a new methodology is used to estimate the import demand function.
Findings
There is evidence of an asymmetric response of rice imports to fluctuations in economic activity and the exchange rate in the short run, and only in the long run for the latter. An increase in rice imports with NAFTA is also confirmed, as well as two extraordinary variations of rice imports during the study period.
Keywords
Rice imports; ARDL; NARDL; structural change; outliers
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publisher |
Colegio de Postgraduados |
publishDate |
2021 |
url |
https://revista-agroproductividad.org/index.php/agroproductividad/article/view/1947 |
work_keys_str_mv |
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1762928101198659584 |