Goods and Asset Market Interdependence in a Risky World
This paper explores the link between international asset markets and international trade in goods to determine whether trade along these dimensions tends to be complementary or plays the role of substitutes. International financial markets permit agents in different countries to pool away the idiosyncratic portion of risk, while in the absence of international financial markets, countries will pursue other means to insure against unanticipated disturbances. The author shows that the endogeny of resource allocations to market completeness leads to a relationship of complementarity between trade in goods and trade in assets. Copyright 1994 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
Volume (Year): 35 (1994)
Issue (Month): 3 (August)
|Contact details of provider:|| Postal: 160 McNeil Building, 3718 Locust Walk, Philadelphia, PA 19104-6297|
Phone: (215) 898-8487
Fax: (215) 573-2057
Web page: http://www.econ.upenn.edu/ier
More information through EDIRC
|Order Information:|| Web: http://www.blackwellpublishing.com/subs.asp?ref=0020-6598 Email: |
When requesting a correction, please mention this item's handle: RePEc:ier:iecrev:v:35:y:1994:i:3:p:551-63. See general information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.