THE GAINS FROM TRADE FOR A MONETARY ECONOMY ONCE AGAIN

Authors
PALIVOS T YIP CK
Citation
T. Palivos et Ck. Yip, THE GAINS FROM TRADE FOR A MONETARY ECONOMY ONCE AGAIN, Canadian journal of economics, 30(1), 1997, pp. 208-223
Citations number
27
Categorie Soggetti
Economics
Journal title
Canadian journal of economics → ACNP
ISSN journal
00084085
Volume
30
Issue
1
Year of publication
1997
Pages
208 - 223
Database
ISI
SICI code
0008-4085(1997)30:1<208:TGFTFA>2.0.ZU;2-V
Abstract
We examine the effects of free trade on a small open economy within a dynamic generalized cash-in-advance model. We provide a complete chara cterization for the possibility of harmful trade and suggest alternati ve economic policies that can convert the loss associated with free tr ade into a gain. We also find, contrary to standard results, that ther e exists an optimal tariff for a small open economy, and we use calibr ation methods to assess its value.