Explaining the U.S. Trade Deficit
Conventional theory makes the curious assumption that, in international trade, movements in the real exchange rate negate cost differences so as to make all countries equally competitive. But quite the contrary, it is absolute cost advantages that determine competition between countries, just as they determine the relative price of two sets of goods within one country
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- Rudiger Dornbusch, 1988.
"Real Exchange Rates and Macroeconomics: A Selective Survey,"
NBER Working Papers
2775, National Bureau of Economic Research, Inc.
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- Anwar M. Shaikh & Rania Antonopoulos, 1998.
"Explaining Long-Term Exchange Rate Behavior in the United States and Japan,"
Economics Working Paper Archive
wp_250, Levy Economics Institute.
- Anwar Shaikh & Rania Antonopoulos, 1998. "Explaining long term exchange rate behavior in the United States and Japan," Macroeconomics 9809011, EconWPA.
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- Bienenfeld, Mel, 1988. "Regularity in Price Changes as an Effect of Changes in Distribution," Cambridge Journal of Economics, Oxford University Press, vol. 12(2), pages 247-55, June.
- Kenneth Rogoff, 1996. "The Purchasing Power Parity Puzzle," Journal of Economic Literature, American Economic Association, vol. 34(2), pages 647-668, June.
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