IDEAS home Printed from https://ideas.repec.org/a/bla/ecorec/v54y1978i3p380-386.html
   My bibliography  Save this article

Monetary Expansion in an Open Economy of Intermediate Size

Author

Listed:
  • WILLIAM W. ROBERTS

Abstract

This paper introduces a monetary asset, perceived as an addition to wealth, into a two‐country neoclassical model of accumulation. As domestic monetary expansion changes, demand for the investment good is shifted. This alters the terms and level of trade as well as production and shifts the balanced growth paths of both economies. For a non‐specialized world it is found that an increase in domestic monetary expansion will increase the domestic overall capital intensity, decrease the foreign overall capital intensity, and worsen the terms of trade for the country importing the investment good.

Suggested Citation

  • William W. Roberts, 1978. "Monetary Expansion in an Open Economy of Intermediate Size," The Economic Record, The Economic Society of Australia, vol. 54(3), pages 380-386, December.
    • Handle: RePEc:bla:ecorec:v:54:y:1978:i:3:p:380-386
    DOI: 10.1111/j.1475-4932.1978.tb01639.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1475-4932.1978.tb01639.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1475-4932.1978.tb01639.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Foley, Duncan K & Sidrauski, Miguel, 1970. "Portfolio Choice, Investment and Growth," American Economic Review, American Economic Association, vol. 60(1), pages 44-63, March.
    2. H. Oniki & H. Uzawa, 1965. "Patterns of Trade and Investment in a Dynamic Model of International Trade," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 32(1), pages 15-37.
    3. Polly Reynolds Allen, 1972. "Money and Growth in Open Economies," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 39(2), pages 213-219.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Y. N. Shieh & A. Takayama, 1980. "Monetary Expansion, Balance of Trade and Economic Growth:Comments and Clarifications," The Economic Record, The Economic Society of Australia, vol. 56(152), pages 94-98, March.
    2. Y. Allen Tso, 1988. "Monetary Expansion, International Trade and Capital Accumulation," The Economic Record, The Economic Society of Australia, vol. 64(2), pages 113-119, June.
    3. Yeung‐Nan Shieh, 1984. "On Monetary Expansion, Terms of Trade and Economic Growth," The Economic Record, The Economic Society of Australia, vol. 60(2), pages 128-132, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Maria Dolores Guillo & Fidel Perez-Sebastian, 2015. "Convergence in a Dynamic Heckscher–Ohlin Model with Land," Review of Development Economics, Wiley Blackwell, vol. 19(3), pages 725-734, August.
    2. Fukao Kyoji & Hamada Koichi, 1994. "International Trade and Investment under Different Rates of Time Preference," Journal of the Japanese and International Economies, Elsevier, vol. 8(1), pages 22-52, March.
    3. Karine Constant & Marion Davin, 2019. "Unequal Vulnerability to Climate Change and the Transmission of Adverse Effects Through International Trade," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(2), pages 727-759, October.
    4. Fedotenkov, Igor & Van Groezen, Bas & Meijdam, Lex, 2019. "International trade with pensions and demographic shocks," Journal of Pension Economics and Finance, Cambridge University Press, vol. 18(1), pages 140-164, January.
    5. Alexander B. Darku, 2021. "International trade and income convergence: Sorting out the nature of bilateral trade," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(4), pages 5337-5348, October.
    6. Wei-Bin Zhang, 2018. "A Growth Theory Based on Walrasian General Equilibrium, Solow-Uzawa Growth, and Heckscher-Ohlin Trade Theories," Interdisciplinary Description of Complex Systems - scientific journal, Croatian Interdisciplinary Society Provider Homepage: http://indecs.eu, vol. 16(3-B), pages 452-464.
    7. Rizwana Siddiqui & A. R. Kemal, 2006. "Poverty-reducing or Poverty-inducing? A CGE-based Analysis of Foreign Capital Inflows in Pakistan," PIDE-Working Papers 2006:2, Pakistan Institute of Development Economics.
    8. Alan V. Deardorff, 2011. "Rich And Poor Countries In Neoclassical Trade And Growth," World Scientific Book Chapters, in: Robert M Stern (ed.), Comparative Advantage, Growth, And The Gains From Trade And Globalization A Festschrift in Honor of Alan V Deardorff, chapter 25, pages 295-313, World Scientific Publishing Co. Pte. Ltd..
    9. Chun‐Yan Kuo, 1977. "Intermediate Products and the Two‐Sector Growth Model in an Open Economy," The Economic Record, The Economic Society of Australia, vol. 53(1), pages 96-109, March.
    10. Wei-Bin Zhang, 2017. "Spatial Agglomeration And Economic Development With The Inclusion Of Interregional Tourism," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 62(213), pages 93-128, April - J.
    11. Wei-Bin Zhang, 2014. "Multi-regional economic growth with public good and regional fiscal policies in a small-open economy," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 52(2), pages 409-429, March.
    12. E. Young Song, 2014. "Trade and the Speed of Convergence," Review of Development Economics, Wiley Blackwell, vol. 18(1), pages 1-12, February.
    13. María Dolores Guilló, 1995. "Terms-Of-Trade And The Current Account: A Two-Country/Two-Sector Growth Model," Working Papers. Serie AD 1995-03, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
    14. Ventura, Jaume, 2005. "A Global View of Economic Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 22, pages 1419-1497, Elsevier.
    15. Claustre Bajona & Timothy J. Kehoe, 2006. "Demographics in Dynamic Heckscher-Ohlin Models: Overlapping Generations Versus Infinitely Lived Consumers," NBER Working Papers 12566, National Bureau of Economic Research, Inc.
    16. Joël Hellier, 2013. "The North-South HOS Model, Inequality and Globalization," Palgrave Macmillan Books, in: Joël Hellier & Nathalie Chusseau (ed.), Growing Income Inequalities, chapter 4, pages 107-146, Palgrave Macmillan.
    17. Zhang, Wei-Bin, 1997. "A two-region model with endogenous capital and knowledge--locational amenities and preferences," International Review of Economics & Finance, Elsevier, vol. 6(1), pages 1-16.
    18. Alejandro Cuñat & Marco Maffezzoli, 2007. "Can Comparative Advantage Explain the Growth of us Trade?," Economic Journal, Royal Economic Society, vol. 117(520), pages 583-602, April.
    19. Earl A. Thompson, 1976. "A Reformulation of Macroeconomic Theory," UCLA Economics Working Papers 075, UCLA Department of Economics.
    20. Austan Goolsbee, 1997. "Investment Tax Incentives, Prices, and the Supply of Capital Goods," NBER Working Papers 6192, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecorec:v:54:y:1978:i:3:p:380-386. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/esausea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.