Journal ArticleDOI
Contractionary devaluation, substitution in production and consumption, and the role of the labor market
TLDR
In this article, the condition under which devaluation reduces demand for home goods, and thus aggregate output if real exports are fixed, basically depends on the sign of one plus the weighted sum of the price elasticities of demand for imported consumer goods and of derived demand for inputs.About:
This article is published in Journal of International Economics.The article was published on 1983-02-01. It has received 102 citations till now. The article focuses on the topics: Devaluation & Aggregate demand.read more
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Are Devaluations Contractionary
TL;DR: In this article, the authors extended the Khan and Knight (1981) model to empirically address the issue of contractionary devaluations, considering the effect of money surprises, fiscal factors, terms of trade changes and devaluations on the level of real output.
Journal ArticleDOI
Contractionary Devaluation in Developing Countries: An Analytical Overview
J. Saul Lizondo,Peter J. Montiel +1 more
TL;DR: The authors explored links between the exchange rate and real output within a unified, fairly general analytical framework that incorporates several of the developing country features cited in the literature and found that many of the arguments on both sides of the debate about contractionary devaluation require modification, and that the direction of the impact effects of devaluation on real output is ambiguous on analytical grounds.
Journal ArticleDOI
Does devaluation improve the current account
Thorvaldur Gylfason,Ole Risager +1 more
TL;DR: In this article, the link between devaluation, foreign interest payments, and the current acccount was incorporated into a fairly general macroeconomic model in which exchange rate changes influence aggregate demand through exports, imports, and expenditures as well as aggregate supply via the cost of imported factors of production.
Journal ArticleDOI
Output, devaluation and the real exchange rate in developing countries
TL;DR: In this paper, the authors evaluate the effect of devaluaciones on real-world production in terms of output, devaluación and taux de change reel, and conclude that devaluization has a negative impact on the output of real-life products.
Posted Content
The Labor Market and Economic Adjustment
TL;DR: In this article, the authors examine the role of the labor market in the transmission process of adjustment policies in developing countries and examine the implications of wage inertia, nominal contracts, labor market segmentation, and impediments to labor mobility for stabilization policies.
References
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Foreign Trade Regimes and Economic Development: Liberalization Attempts and Consequences
TL;DR: In this article, the authors discuss the consequences of liberalization attempts and their consequences in international economic relations, and present a survey of the literature on this topic, focusing on the following topics:
Journal ArticleDOI
Contractionary effects of devaluation
TL;DR: In this article, a simple model is developed to illustrate a number of contractionary effects of currency devaluation, some of which have been noted previously, and it is shown that depreciation can lead to a reduction in national output if imports initially exceed exports; there are differences in consumption propensities from profits and wages; and government revenues are increased by devaluation.
Book
Money Employment and Inflation
TL;DR: This paper presented a choice-theoretic analysis of the determination of the level of employment and the rate of inflation, and recast macroeconomic analysis in terms of a theory of exchange under non-market clearing conditions.
Book ChapterDOI
Currency devaluation in developing countries
TL;DR: In this paper, the authors describe the currency devaluation in developing countries and propose an elasticity approach focusing on the substitution among commodities, both in consumption and in production induced by the relative price changes wrought by the devaluation.