Import demand for malt in selected countries: A linear approximation of AIDS

Canada has emerged to be one of the major world exporters of malt. However, the European Union (EU) dominates the world malt trade due in part to qual ity advantages and/or export restitutions. A Linear Approximation of the Al most Ideal Demand System (LA/AIDS) was estimated for four major malt import ing countries: Japan, Brazil, Philippines and Venezuela. Elasticities of su bstitution for malt among different sources were computed. Results show tha t malt imported from the EU is least substitutable with malt from other sou rces, and demand for EU malt is less responsive to changes in price. Expend iture elasticities suggest a preference for malt imports from the EU compar ed to malt from other sources. For these reasons, the study concludes that price-based export expansion measures for non-EU malt may not be very effec tive.