1. Department of Economics, METU - Middle East Technical University, Ankara, Turkey
International economic relations between countries are reaching a new
peak every coming day thanks to globalization. One of the most important
parts of these relations is the trade, which policymakers should scrutinize.
Considering natural resource-rich economies within the Dutch disease
framework, understanding demand for imported goods could be very useful for policy purposes. This research aims to estimate the import demand
function of an oil reach country – Azerbaijan Republic. This research
examines the relationship between import and GDP and exchange rate by
using cointegration techniques for 1999-2014. Research findings reveal
that there is a long term causality from GDP and exchange rate to imports
of Azerbaijan. It must also be stated that the directions of effects of both
GDP and exchange rate are consistent with what economic theory states.