The terms of trade and the current account: the Harberger-Laursen- Metzler effect.

L. E.O. Svensson, A. Razin

Research output: Contribution to journalArticlepeer-review

11 Scopus citations

Abstract

Examines the effect of terms of trade changes on a small country's spending and current international capital mobility. A temporary (future) terms of trade determination implies a deterioration (improvement) of the trade balance, whereas a permanent terms of trade deterioration has an ambiguous effect, depending on the rate of time preference. Nominal and real variables are considered via exact price indexes. Two periods and an infinite horizon are examined.-Authors

Original languageEnglish
Pages (from-to)97-125
Number of pages29
JournalUniversity of Stockholm, Institute for International Economic Studies, Reprint Series
Volume205
StatePublished - 1983

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