Abstract
A non-linear model is presented to give a global analysis of international debt and trade. It offers an alternative to the sunk-cost explanation of hysteresis, structural breaks and irreversibility. In particular, we show that a natural resource discovery, which turns out to be temporary ex post, may cause a long-term deterioration in the trade balance. (C) 1999 Elsevier Science B.V. All rights reserved. JEL classifications: F32; F40.
| Original language | English |
|---|---|
| Pages (from-to) | 179-188 |
| Number of pages | 10 |
| Journal | Economic Modelling |
| Volume | 16 |
| Publication status | Published - 1999 |
Keywords
- international debt
- hysteresis
- irreversibility
- EXCHANGE-RATE
- EXPECTATIONS
- HYSTERESIS
- MODELS