– The purpose of this paper is to develop a formal representation of the imperfect substitutes model (ISM) of partial equilibrium, trade policy analysis and to conduct sensitivity analysis on the behavioral parameters of the model.
– The paper develops an ISM in a manner that is conformable to more complex, applied general equilibrium models of trade policy analysis.
– The paper presents a set of sensitivity analyses on key behavioral parameters for a better understanding of the model's properties.
– Sensitivity analysis on the values of behavioral parameters in ISMs needs to be conducted by trade policy modelers.
– The ISM is made more explicit here than in most representations, something that will be of great use to practitioners.
– While widely used in trade policy circles, the ISM is rarely explicitly formulated, nor the role of its behavioral parameters explored.
