panel unit root tests (Im, Pesaran and Shin, 1997) and panel cointegration tests (Pedroni, forthcoming). We test our model …To study the elasticities of import demand function, we build a heterogeneous panel with data of 40 counties and use … elasticities, we make use of two modified panel version of FMOLS and DOLS developed by Pedroni (1996, 2000, 2001). Our tests prove …