International Finance Discussion Papers - Growth-Led Exports: Is Variety the Spice of Trade (Paperback)

Fast-growing countries tend to experience rapid export growth with little secular change in their terms of trade. This contradicts most international macroeconomic models, which predict that productivity and labor supply shocks can affect exports only through changes in the terms of trade. This paper generalizes the monopolistic competition trade model of Helpman and Krugman (1985), providing a basis for growth-led exports without declining terms of trade. The key mechanism behind this result is that fast-growing countries are able to develop new varieties of products that can be exported without pushing down the prices of existing products. There is strong support for the new model in long-run export growth of many countries in the post-war era. These results have major implications for the analysis of supply shocks in international macroeconomic models.

General

Imprint:	Biblio Bazaar
Country of origin:	United States
Release date:	February 2013
First published:	February 2013
Creators:	United States Federal Reserve Board
Authors:	Joseph E. Gagnon
Dimensions:	246 x 189 x 2mm (L x W x T)
Format:	Paperback - Trade
Pages:	36
ISBN-13:	978-1-288-72811-4
Categories:	Books > Social sciences > Politics & government > General Promotions
LSN:	1-288-72811-5
Barcode:	9781288728114

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