Interregional Income Determination: A Graphical Analysis for Interdependent Economies

This theoretical analysis develops a model for analyzing public policy in interdependent economies. The model allows for feed-backs between the commodity, money, and labor markets in all of the economic systems. Regionally oriented monetary policies are fully analyzed, as are regional oriented fiscal policies. In both cases, the feed-back mechanisms and iterative processes of approaching full equilibrium in all markets is demonstrated. The process of economic forecasting for interdependent economies is also provided.