search query: @indexterm International trade / total: 2170
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| Author: | Kollmann, R. |
| Title: | US trade balance dynamics: the role of fiscal policy and productivity shocks and of financial market linkages. |
| Journal: | Journal of International Money and Finance
1998 : AUG, VOL. 17:4, p. 637-669 |
| Index terms: | FISCAL POLICY PRODUCTIVITY FINANCIAL MARKETS INTERNATIONAL TRADE USA SIMULATION MODELS |
| Language: | eng |
| Abstract: | The author examines whether domestic and foreign productivity and fiscal policy changes can account for the wide swings in US net exports during the period 1975-1991. He uses a two-country Real Business Cycle model for that purpose. The model is simulated using data on productivity, government purchases and taxes. A version of the model with incomplete asset markets, in which only bonds can be used international capital flows, tracks the US trade balance fairly closely, provided permanent country-specific productivity shifts are assumed. The simulations suggest that US productivity changes were the main source of fluctuations in US net exports. |
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