Money, Time Preference and External Balance

Philippe Weil

No 2822, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: In monetary economies, international differences in rates of time preference do not in general lead to long run trade imbalances -- in sharp contrast with Butter's 119811 results on non-monetary overlapping generation economies. This claim is documented within the context of a simple two country framework in which new immortal families enter each economy over time, with the two countries differing only in their subjective discount rates. Even if consumers are more "impatient" at home than abroad, trade is balanced in the long run in the presence of valued fiat currencies in constant supply, and the current account is indeterminate.

Date: 1989-01
Note: ME
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Published as European Economic Review, Vol. 33, nos. 2/3 (1989): 564-572.

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Related works:
Journal Article: Money, time preference and external balance (1989)
Working Paper: Money, Time Preference and External Balance (1989)
Working Paper: Money, Time Preference and External Balance (1989)
Working Paper: Money, Time Preference, and External Balance (1989)
Working Paper: Money, Time Preference, and External Balance (1989)
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