Trade and Indeterminacy in a Dynamic General Equilibrium Model.

This paper introduces sector-specific externalities in the Heckscher-Ohlin two-country dynamic general equilibrium model to show that indeterminacy of the equilibrium path in the would market can occur. Under certain conditions in terms of factor intensities, there are multiple equilibrium paths from the same initial distribution of capital in the world market, and the distribution of capital in the limit differs among equilibrium paths.

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Year of publication:	2001
Authors:	Shimomura, K. ; Nishimura, K.
Subject:	EXTERNALITIES \| ECONOMIC MODELS \| MARKET

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Type of publication:	Book / Working Paper
Notes:	14 pages
Classification:	E13 - Neoclassical ; F11 - Neoclassical Models of Trade
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005781003