Trade balance volatility and consumption structures in small open economies

Akihiko Ikeda

Economics Letters, 2017, vol. 156, issue C, 114-117

Abstract: This paper aims to explain the difference in trade balance volatility between emerging and developed small open economies under a simple endowment economy model. The results of the nonlinear simulations with occasionally binding collateral constraints show that in a model with collateral capital, the difference can be explained by the share of tradables in consumption.

Keywords: Collateral constraint; Share of tradables; Trade balance (search for similar items in EconPapers)
JEL-codes: E32 E44 F41 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:156:y:2017:i:c:p:114-117

DOI: 10.1016/j.econlet.2017.04.024

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