IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/37431.html
   My bibliography  Save this paper

Foreigh Asset Accumulation and Macroeconomic Policies

Author

Listed:
  • Gong, Liutang
  • Zou, Heng-fu

Abstract

In this paper, we have studies the effects of macroeconomic policies on foreign asset accumulation in a wealth effect model used by Bardhan (1967), Kurz (1968), Calvo (1980) and Blanchard (1983). Our results differ dramatically from the ones in Obstfeld (1981). In particular, we have shown that government spending always reduces foreign asset accumulation (or increases foreign borrowing). While Obstfeld's model turned the conventional Mundell-Fleming model on its head, our wealth effect approach has restored its validity.

Suggested Citation

  • Gong, Liutang & Zou, Heng-fu, 2012. "Foreigh Asset Accumulation and Macroeconomic Policies," MPRA Paper 37431, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:37431
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/37431/1/MPRA_paper_37431.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robert J. Barro, 2003. "Determinants of Economic Growth in a Panel of Countries," Annals of Economics and Finance, Society for AEF, vol. 4(2), pages 231-274, November.
    2. Olivier Jean Blanchard, 1983. "Debt and the Current Account Deficit in Brazil," NBER Chapters, in: Financial Policies and the World Capital Market: The Problem of Latin American Countries, pages 187-198, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Heng-Fu Zou, 1997. "Dynamic analysis in the Viner model of mercantilism," Journal of International Money and Finance, Elsevier, vol. 16(4), pages 637-651, August.
    2. I. Hakan Yetkiner, 2006. "Saglik ile Buyume," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 6(2), pages 83-91.
    3. Łukasz Nazarko & Eigirdas Žemaitis & Łukasz Krzysztof Wróblewski & Karel Šuhajda & Magdalena Zajączkowska, 2022. "The Impact of Energy Development of the European Union Euro Area Countries on CO 2 Emissions Level," Energies, MDPI, vol. 15(4), pages 1-12, February.
    4. Juan Cañada Vicinay, 2015. "Coyuntura económica y dotación social en la ecuación intergeneracional de Becker Tomes. Una estimación para España 2002-2013," Investigaciones de Economía de la Educación volume 10, in: Marta Rahona López & Jennifer Graves (ed.), Investigaciones de Economía de la Educación 10, edition 1, volume 10, chapter 40, pages 793-810, Asociación de Economía de la Educación.
    5. Jerzmanowski, Michal & Tamura, Robert, 2019. "Directed technological change & cross-country income differences: A quantitative analysis," Journal of Development Economics, Elsevier, vol. 141(C).
    6. Simplice A. Asongu & Joseph Nnanna & Paul N. Acha-Anyi, 2021. "The Openness Hypothesis in the Context of Economic Development in Sub-Saharan Africa: The Moderating Role of Trade Dynamics on FDI," The International Trade Journal, Taylor & Francis Journals, vol. 35(4), pages 336-359, July.
    7. Benjamin Jung, 2009. "Adjustment Dynamics of Bilateral Trade Flows: Theory and Evidence," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 145(IV), pages 421-442, December.
    8. Shakoor Ahmed & Khorshed Alam & Afzalur Rashid & Jeff Gow, 2020. "Militarisation, Energy Consumption, CO2 Emissions and Economic Growth in Myanmar," Defence and Peace Economics, Taylor & Francis Journals, vol. 31(6), pages 615-641, August.
    9. Nagara, Patria & , yolanda, 2020. "The economic growth and affecting factors in Sumatera island," OSF Preprints rfcuj, Center for Open Science.
    10. Ernst, Ekkehard & Semmler, Willi & Haider, Alexander, 2017. "Debt-deflation, financial market stress and regime change – Evidence from Europe using MRVAR," Journal of Economic Dynamics and Control, Elsevier, vol. 81(C), pages 115-139.
    11. Zou, Heng-fu, 2012. "Optimal design of intergovernmental grants in a dynamic model," MPRA Paper 37427, University Library of Munich, Germany.
    12. Andersen, Thomas Barnebeck & Barslund, Mikkel & Hansen, Casper Worm & Harr, Thomas & Jensen, Peter Sandholt, 2014. "How much did China's WTO accession increase economic growth in resource-rich countries?," China Economic Review, Elsevier, vol. 30(C), pages 16-26.
    13. Kaminsky, Graciela L. & Pereira, Alfredo, 1996. "The debt crisis: lessons of the 1980s for the 1990s," Journal of Development Economics, Elsevier, vol. 50(1), pages 1-24, June.
    14. Omar Al-Ubaydli & Faith Fatchen & John List, 2024. "Using Field Experiments to Understand the Impact of Institutions on Economic Growth," Natural Field Experiments 00787, The Field Experiments Website.
    15. Tausch, Arno, 2011. "Costa Rica, superstar? some reflections on the global drivers and bottlenecks of the happy planet index," MPRA Paper 33226, University Library of Munich, Germany.
    16. Darko, Christian Kwasi, 2015. "Determinants of Economic Growth in Ghana," EconStor Preprints 123098, ZBW - Leibniz Information Centre for Economics.
    17. Simplice A. Asongu & Nicholas M. Odhiambo, 2022. "Financial Access and Value Added in Sub-Saharan Africa: Empirical Evidence from the Agricultural, Manufacturing and Service Sectors," Working Papers 22/009, European Xtramile Centre of African Studies (EXCAS).
    18. Tarsalewska, Monika, 2015. "The timing of mergers along the production chain, capital structure, and risk dynamics," Journal of Banking & Finance, Elsevier, vol. 57(C), pages 51-64.
    19. Anass Arbia & Khalid Sobhi & Mohamedou Karim & Mohammed Eddaou, 2023. "FDI, Information and Communication Technology, and Economic Growth: Empirical Evidence from Morocco," Post-Print hal-04207179, HAL.
    20. Wanniarachchi, Sasindu Lakruwan, 2020. "The Nexus among External Debt and Economic Growth: Evidence from South Asia," OSF Preprints ghfdb, Center for Open Science.

    More about this item

    Keywords

    Foreigh Asset Accumulation; Becker's Time Preference; Macroeconomic Policies;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:37431. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.