Fiche du document
- handle: 10670/1.8nhxrg
- halshs: halshs-01079773
info:eu-repo/semantics/OpenAccess
Mots-clés
two-sector OLG model two-country local indeterminacy endogenous fluctuations dynamic efficiencySujets proches
Trade Commercial trade Foreign trade Papers Pattern Model Trade TradeCiter ce document
Antoine Le Riche, « Macroeconomic Volatility and Trade in OLG Economies », HAL-SHS : économie et finance, ID : 10670/1.8nhxrg
Métriques
Partage / Export
Résumé
This paper analyzes the effect of free-trade integration on the dynamical properties of economies. We formulate a two-country two-good two-factor overlapping generations model where countries only differ with respect to their discount rate. The main contribution of this paper is to show that opening to international trade may have a destabilizing effect. Especially we prove that, under perfect mobility of labor and capital between countries, sunspot cycles can occur in the trade regime although one country is characterized by saddle-point stability in the autarky regime.