DEMAND AND SUPPLY FACTORS IN THE DETERMINATION OF NIE EXPORTS - A SIMULTANEOUS ERROR-CORRECTION MODEL FOR HONG-KONG - A COMMENT

Muscatelli, Srinivasan and Vines (EJ 1992) purported to refute Riedel's (EJ 1988) finding that Hong Kong is a small, price-taking country in world markets. This comment shows, however, that MSV's results are due entirely to an unjustifiable restriction they imposed on the estimated export demand equation, and not the result of using a superior estimation technique, as they asserted.