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Technological dependence and budgetary policy in an uncertain horizon model of small open economy

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  • Dai, Meixing

Abstract

It is set up in this paper a formulation which endogeneizes the choice of investment inputs in open economy context where a small country may depend on foreign technology. Then it is integrated into a macroeconomic model of small specialized country with Blanchard-Yaari type uncertain horizon consumers. Contrary to some models with ad hoc formulation, it is found in this model that generally the budgetary policy has eects on the short- and long-run capital stock. The corresponding intertemporal spill-over effects of the budgetary policy, through the supply side of economy on external position, aggregate consumption, real exchange rate and capital evaluation ratio, are also examined.

Suggested Citation

  • Dai, Meixing, 1992. "Technological dependence and budgetary policy in an uncertain horizon model of small open economy," MPRA Paper 14003, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:14003
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    File URL: https://mpra.ub.uni-muenchen.de/14348/1/MPRA_paper_14348.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Technological dependence; choice of investment inputs; capital stock; capital evaluation ratio; real exchange rate and external position;
    All these keywords.

    JEL classification:

    • F34 - International Economics - - International Finance - - - International Lending and Debt Problems
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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