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Evolving Patterns in Manufactures Import Demand in the European Union: An Empirical Investigation of

European integration has changed patterns of trade and investment, and has had a significant effect on the growth process. This paper studies import demand in 10 European countries over the period 1970 – 1995, and our objective is to investigate whether the process of European Integration has had direct and indirect effects on imports. We provide evidence for parametric change in traditional import demand equations, suggesting that important variables or structural factors are missing from the long-run equations. We present equations based on new trade theory, where technology and foreign direct investment variables are present and their effects are significant.