The balance of trade, the terms of trade, and the real exchange rate : an intertemporal optimizing framework /

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Bibliographic Details
Author / Creator:	Ostry, Jonathan David, 1962- author.
Imprint:	[Washington, D.C.] : International Monetary Fund, 1988.
Description:	1 online resource (iii, 41 pages) : illustrations.
Language:	English
Series:	IMF working paper ; WP/88/2 IMF working paper ; WP/88/2.
Subject:	Terms of trade -- Mathematical models. Foreign exchange -- Mathematical models. Foreign exchange. Balance of payments. International trade. Currency question. Terms of trade. Foreign exchange -- Mathematical models. Terms of trade -- Mathematical models.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/13510776

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Other authors / contributors:	International Monetary Fund, issuing body.
Notes:	"January 12, 1988." Print version record.
Summary:	This paper uses an intertemporal optimizing model of a small open economy to analyze how terms of trade changes affect real exchange rates and the trade balance. We consider temporary current, anticipated future, and permanent changes in the terms of trade. The results suggest that the relationship between the terms of trade and the current account (the so-called Harberger-Laursen-Metzler effect) may be quite sensitive to whether or not the model incorporates nontrade goods. Thus, the real exchange rate may be an important variable through which terms of trade shocks are transmitted to the current account.
Other form:	Print version: Ostry, Jonathan David, 1962- Balance of trade, the terms of trade, and the real exchange rate. [Washington, D.C.] : International Monetary Fund, 1988

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