External shocks, policy response and economic performance

J. Peter Neary

No 199328, Working Papers from School of Economics, University College Dublin

Abstract: This paper examines the responsiveness of real income and the balance of payments to external shocks in a small open economy. It is shown that tariff restrictions and age rigidities tend to increase responsiveness and quota restrictions tend to educe it. The implications for policy response are considered and a micro-theoretic foundation for the distinction between expenditure-reducing and expenditure-switching policies is provided.

Keywords: International trade policy; Tariffs and quotas; Domestic distortions; Shadow prices; External shocks; Commercial policy; States, Small--Economic conditions; Externalities (Economics) (search for similar items in EconPapers)
JEL-codes: F10 F13 (search for similar items in EconPapers)
Date: 1993-09
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Citations: View citations in EconPapers (1)

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http://hdl.handle.net/10197/1740 First version, 1993 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:ucn:wpaper:199328

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