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- W2953470437 abstract "A three-good, stochastic intertemporal equilibrium model of a small open economy is used to examine the link between terms of trade and business cycles. Equilibrium co-movements of model economies representing industrial and developing countries are computed and compared with the stylized facts of 30 countries. The results show that terms-of-trade shocks account for half of observed output variability and that the model mimics the Harberger-Laursen-Metzler effect and produces large deviations from purchasing power parity. The elasticity of substitution between tradable and nontradable goods and the persistence of the shocks play a key role in producing these results." @default.
- W2953470437 created "2019-07-12" @default.
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- W2953470437 date "1992-01-01" @default.
- W2953470437 modified "2023-09-28" @default.
- W2953470437 title "The Terms of Trade and Economic Fluctuations" @default.
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- W2953470437 doi "https://doi.org/10.5089/9781451852066.001" @default.
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