THE PAKISTAN DEVELOPMENT REVIEW
Ashok Parikh. The Estimation and Forecasting of Trade Shares. Bangkok: United Nations Publication, 1986.344 pp.(Development Papers No.5)
Macro-econometric’ models have proved their worth as tools of intelligent policy-making in a large number of countries where the required data are reasonably good. Hence, despite lingering doubts cast by the rational-expectations school about its utility for macro-economic management, macro-econometric model building has continued unabated. It is, however, well known that national econometric models tell an incomplete story about the international linkages of national economies. Even though every respectable national model contains foreign trade equations, the country-Wide macro-models do not contain the equations to permit the model-builders to incorporate explicit1y the inter-country linkages. It was this realization that led to the creation of Project LINK at the University of Pennsylvania in 1968 under the supervision of Professor Lawrence Klein. Similar efforts are also being pursued by the ESCAP Secretariat thrOUgh Project Asian SUb-Unk to promote a better understanding of the extent of interdependence among the economies of the region. Lately the Asian and Pacific Development Centre, (APDC) in collaboration with the Pakistan Ipstitute of Development Economics (PIDE), has undertaken similar efforts to link the economies of South Asian countries to promote a better understanding of the extent of interdependence through international trade among the economies of the region.