North-South interaction and commod control
AbstractA simple model of North-South interaction is presented with a Keynesian North producing industrial goods and a Classical South producing corn. If the terms of trade clear the corn market then commodity price stabilisation can only slightly increase the average value of Northern real consumption. But if there is real wage resistance in the North then output deflation in the North is necessary to avoid inflationary pressure whenever the terms of trade tend to turn against the North; commodity price stabilisation could, in such circumstances, greatly improve Northern welfare. The paper also examines whether fiscal policy in the North, instead of commodity price stabilisation, could provide equally large improvements in Northern welfare.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Development Economics.
Volume (Year): 23 (1986)
Issue (Month): 2 (October)
Contact details of provider:
Web page: http://www.elsevier.com/locate/devec
Other versions of this item:
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Alexander W. Hoffmaister & Mahmood Pradhan & Hossein Samiei, 1996.
"Have North-South Growth Linkages Changed?,"
IMF Working Papers
96/54, International Monetary Fund.
- Richard Mash, 1996. "Supply flexibility and insurance under commodity market instability," Economics Series Working Papers WPS/1996-10, University of Oxford, Department of Economics.
- Braverman, Avishay & Kanbur, Ravi & Brandao, Antonio Salazar P. & Hammer, Jeffrey & Lopes, Mauro de Rezende & Tan, Alexandra, 1990. "Costs and benefits of agricultural price stabilization in Brazil," Policy Research Working Paper Series 564, The World Bank.
- S. Murshed, 1992. "Comparing quotas with VERs: A three-region, North-South-NICs macroeconomic analysis," Open Economies Review, Springer, vol. 3(3), pages 255-270, October.
- Srinivasan, T.N., 1986. "International Trade and Factor Movements in Development Theory, Policy, and Experience," 1986: Trade and Development Meeting, December 1986, CIMMYT, Mexico City, Mexico 50651, International Agricultural Trade Research Consortium.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If references are entirely missing, you can add them using this form.