Some Scenarios on the impacts of the COVID-19 pandemic to automobile import demand function in Azerbaijan

Abstract

The article examines the possible scenarios of price changes in the car market of Azerbaijan as a result of Covid-19. In the study, the demand and supply functions were determined by the two-stage simultaneous equation method. The author concludes that the car market in Azerbaijan depends not only on domestic and world prices but also on household incomes. As Covid-19 pandemic reduces household incomes, as well as global incomes, it is likely that demand to import will be declined and domestic prices will be decreased. But by decreasing of supply amount the prices in the domestic market will not be declined strongly. As well as the demand function to import dependences on the world price.