The Michigan Model
of World Production and Trade

Elasticities

The following table is reproduced from Deardorff and Stern (1990, p. 40-41):

TABLE 3.2. The Industries of the Model, Their Assumed Elasticities of Substitution and Demand, and Tariff and NTB Data for Each
Industry and ISIC Code Elasticity of
Capital-Labor
Substitution
Elasticity of
Import-Home-Good
Substitution
U.S. Import
Demand
Elasticity
Post-Tokyo Round
Average Tariff
Level
(percentage)
Assumed
Average Coverage
by NTBs
(percentage)
Traded Goods
    Agr., forestry, and fishery 1 0.787       1.139           1.130      6.9           18.4          
    Food, beverage, and tobacco 310 1.746       1.133           1.130      11.0           23.4          
    Textiles 321 0.963       1.147           1.140      8.5           29.1          
    Wearing apparel 322 1.191       4.269           3.920      17.5           46.5          
    Leather products 323 1.230       1.810           1.580      3.0           1.1          
    Footwear 324 1.436       2.825           2.390      12.0           37.1          
    Wood products 331 0.852       1.757           1.690      1.9           0.0          
    Furniture and fixtures 332 1.122       3.096           3.000      6.9           0.0          
    Paper and paper products 341 1.626       1.585           1.550      4.3           0.6          
    Printing and publishing 342 0.810       3.013           3.000      1.5           10.4          
    Chemicals 35A 1.098       2.612           2.530      6.4           4.1          
    Petroleum and related prod. 35B 10.011       2.359           1.960      1.4           47.8          
    Rubber products 355 1.647       5.707           5.260      4.1           3.1          
    Nonmetallic mineral prod. 36A 1.246       2.784           2.700      4.0           8.4          
    Glass and glass prod. 362 1.267       1.628           1.600      8.0           0.0          
    Iron and steel 371 1.382       1.446           1.420      4.3           8.2          
    Nonferrous metals 372 1.350       1.430           1.380      1.7           6.9          
    Metal prod. 381 0.943       3.674           3.590      6.2           2.5          
    Nonelectrical machinery 382 0.677       1.022           1.020      4.7           1.9          
    Electrical machinery 383 0.521       2.110           2.000      7.1           7.1          
    Transport equipment 384 0.344       3.585           3.280      5.9           10.4          
    Miscellaneous manuf. 38A 1.272       1.984           1.780      4.8           2.7          
 
Nontraded Goods
    Mining and quarrying 2 1.541       ---             ---        ---           ---          
    Electricity, gas, and water 4 2.266       ---             ---        ---           ---          
    Construction 5 1.105       ---             ---        ---           ---          
    Wholesale and retail trade 6 2.266       ---             ---        ---           ---          
    Transportation, stor., and comm. 7 1.457       ---             ---        ---           ---          
    Finance, ins., and real est. 8 1.657       ---             ---        ---           ---          
    Community, soc., and pers. serv. 9 1.087       ---             ---        ---           ---          


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