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| Volume 2, No. 2,
August
2003
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Back |
| Trade
in Goods and Trade in Assets |
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| Andre
Burgstalle |
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Department of Economics,
Barnard College, Columbia University, U.S.A. |
| Cem
Karayalcin |
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| Department
of Economics, Florida International University, U.S.A. |
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| Abstract |
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A
two-good, two-country intertemporal general equilibrium model
of pure exchange is presented, in which whatever causes intertemporal
trade also causes intertemporal trade, so that simple textbook
separability fails. The framework allows financial market phenomena
such as international yield arbitrage, portfolio composition shifts,
and capital-flow-financed current account deficits to interact
dynamically with the real phenomena of pure exchange. |
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Key words: intratemporal
trade, intertemporal trade
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| JEL
classification:
F3 |
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