The Excess Supply-Pure Demand Approach to International Commodity Trade: The Case of Japanese Steel Exports to the United States

The purpose of this paper is twofold: 1) to develop a theoretical framework for the analysis of export supply which is empirically more fruitful than existing approaches, and 2) to present an empirical application of the theory to the market for Japanese steel, thereby quantifying important export supply elasticities not dealt with in the past. Evidence is presented which indicates that the supply of Japanese steel exports to the U.S. is price elastic, and sensitive to Japanese and rest of world demand conditions.