Determinants of European Community imports of steel mill products.

Since the depression in 1975, the world steel industry has been suffering from a serious problem of excess production capacity in terms of both physical capital and manpower. As a consequence there has been a growing recourse, by all countries, to trade restrictionist measures in order to protect their domestic industries from outside competition. The European Economic Community (EEC) has been no exception in this sequence of events as witnessed by the amazing number of trade barriers introduced by member states or by the Community authorities during the past decade.
Although the introduction of such barriers provides an ex-post proof of the existence of a highly price-elastic European import demand for steel products, there exists no recent empirical study which has tried to measure the magnitude of this elasticity. This paper is an attempt in that direction. It develops and estimates an import demand function for iron and steel products from third-party countries to the EEC as a whole.[1] The reason for choosing the EEC as a whole, rather than each member state, lies basically in the absence of reliable price data for individual countries.
The paper is divided into four sections. Section II is dedicated to an overview of the recent empirical literature on the same subject. In Section III a new model for imports of iron and steel products into the EEC is developed. A summary and concluding remarks are contained in Section IV, whilst an Appendix to the paper derives the explicit expression for the price variable which appears in the estimated equation. [ABSTRACT FROM AUTHOR]