Sie können Bookmarks mittels Listen verwalten, loggen Sie sich dafür bitte in Ihr SLUB Benutzerkonto ein.
Medientyp:
E-Artikel
Titel:
Assessing the Marshall–Lerner condition within a stock-flow consistent model
Beteiligte:
Carnevali, Emilio;
Fontana, Giuseppe;
Veronese Passarella, Marco
Erschienen:
Oxford University Press (OUP), 2020
Erschienen in:
Cambridge Journal of Economics, 44 (2020) 4, Seite 891-918
Sprache:
Englisch
DOI:
10.1093/cje/bez060
ISSN:
0309-166X;
1464-3545
Entstehung:
Anmerkungen:
Beschreibung:
AbstractWe derive the general equilibrium condition for the terms of trade in a two-country economy model. We show that the Marshall–Lerner condition is only a special case of this condition, in which a full exchange rate pass-through to import prices is assumed. In fact, the Marshall–Lerner condition is not even a ‘useful approximation’ of the general condition. For the full pass-through assumption has destabilising, rather than stabilizing, effects, when it is introduced in a stock-flow consistent dynamic model. More generally, the higher (lower) the pass-through, the slower (quicker) is the adjustment of the economy towards the equilibrium. This is tantamount to saying that the speed of adjustment is a positive function of the strategic behaviour of the exporters, who attempt to retain their market share by keeping their foreign currency-denominated prices unchanged.