The estimated elasticities from the LA/AIDS model show that the Japanese import demand of coffee from Ethiopia, Brazil and Colombia is generally affected more by their own prices than by cross prices. The own-price elasticities of demand
for coffee from the three countries are close to unity. Moreover, coffee from these countries is found to be complementary. The expenditure elasticity of Ethiopian coffee demand is elastic, while those of Brazil and Colombia are inelastic. Generally, the results from estimating expenditure elasticities show an advantage of Ethiopian coffee over Brazilian and Colombian coffee in Japan market. As expenditure on coffeeimport increases by one percent, the demand for Ethiopian coffee will increase by 1.46 percent, while demands for Brazilian and Colombian coffee will increase by less than one percent.
The estimated elasticities from the LA/AIDS model show that the Japanese import demand of coffee from Ethiopia, Brazil and Colombia is generally affected more by their own prices than by cross prices. The own-price elasticities of demandfor coffee from the three countries are close to unity. Moreover, coffee from these countries is found to be complementary. The expenditure elasticity of Ethiopian coffee demand is elastic, while those of Brazil and Colombia are inelastic. Generally, the results from estimating expenditure elasticities show an advantage of Ethiopian coffee over Brazilian and Colombian coffee in Japan market. As expenditure on coffeeimport increases by one percent, the demand for Ethiopian coffee will increase by 1.46 percent, while demands for Brazilian and Colombian coffee will increase by less than one percent.
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