Macroeconomics of an Open Economy

Kamran Dadkhah ()
Additional contact information
Kamran Dadkhah: Northeastern University

Chapter Chapter 5 in The Evolution of Macroeconomic Theory and Policy, 2009, pp 103-116 from Springer

Abstract: Up to the 1960s the Keynesian model of macroeconomics pertained to a closed economy. That is, an economy that has no international trade or movement of capital. In modern times no country could be found to conform to such a description. The model was defended on the ground that it was a first approximation. It was argued that in the case of some countries such as the United States, the amount of international trade compared to the GDP was so small as to be negligible for the sake of analysis. For countries such as small European countries exports and imports were a substantial proportion of the GDP. Therefore, the approximation would be off the mark. But it was argued that if somehow the external balance was maintained, the internal macroeconomic issues could be analyzed separately from international problems.

Keywords: Exchange Rate; Interest Rate; Monetary Policy; Central Bank; Fiscal Policy (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-540-77008-4_5

Ordering information: This item can be ordered from
http://www.springer.com/9783540770084

DOI: 10.1007/978-3-540-77008-4_5

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().