This study attempts to provide with underlying theoretical explanations for exchange rate appreciation due to foreign capital inflow. We use an extended three sector specific factor model to explain why and how an inflow of foreign capital boosts the price of a nontradable good that helps...

Foreign direct investment specially targeted to export sector is relatively new phenomenon in the global economy. Such inflow of foreign capital changes the sectoral composition of the economy and it has some influence on the exchange rate of the destination country. In this study, we attempt to...

This paper attempts to look at the effect of inflow of foreign capital only in the exportable sector on the factor prices and real exchange rate of the concerned economy. In doing so we frame a blend of Heckscher-Ohlin and Specific Factor model of trade which is popularly known as H-O nugget. We...

This paper attempts to investigate the impact on factor prices and real exchange rate owing to an inflow of foreign capital only in the exportable sector of the host country. In doing so, we amalgamate Heckscher-Ohlin and Specific Factor models of trade which is popularly known as the H-O...

The paper addresses the question of whether developing countries possess any built-in mechanism that can cope with external terms-of-trade (TOT) shocks. Using a two-sector, full-employment general equilibrium model with endogenous labor market distortion theoretically it shows that such...

As per the conventional wisdom there should be provision for public assistance for skills acquirement for improving relative wage inequality in the future. Empirical observations on some prominent small OECD countries, however, indicate that the relationship between wage inequality and public...

As per the conventional wisdom there should be provision for public assistance for skill acquirement for achieving higher economic growth in the future. However, empirical observations on small OECD countries over the period 2001-2011 tell somewhat a different story. This study makes an attempt...