A multi-sectoral approach to the Harrod foreign trade multiplier

Andrew B. Trigg and Ricardo Araujo
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Andrew B. Trigg: Department of Economics, The Open University, Milton Keynes, UK

European Journal of Economics and Economic Policies: Intervention, 2018, vol. 15, issue 1, 91-104

Abstract: With this inquiry, we seek to develop a multi-sectoral version of the static Harrod foreign trade multiplier, by showing that it can be derived from an extended version of the Pasinettian model of structural change and international trade. This new version highlights the connections between the balance of payments and levels of employment and production. It is also shown that from this disaggregated version of the Harrod foreign trade multiplier we can derive an aggregate version of the multiplier. By following this approach we go a step further in establishing the connections between the structural economic dynamic and the balance-of-payments-constrained-growth approaches.

Keywords: structural economic dynamics; foreign trade multiplier; balance-of-payments-constrained growth (search for similar items in EconPapers)
JEL-codes: F12 O19 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:elg:ejeepi:v:15:y:2018:i:1:p91-104

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