Title
Transfer Paradox and Indeterminacy in a Dynamic General Equilibrium Model of International Trade
Abstract
This paper connects a traditional topic in trade theory with
a new topic in economic dynamics in a simple two(-country) by
two(-good) dynamic general equilibrium (dge) model by showing
that the transfer paradox, or the donor-enrichment and recipient-impoverishment
transfer, is possible if and only if the indeterminacy, or the
existence of a continuum of dge paths, occurs. The result is a
substantial contribution to both topics, since we assume neither
the presence of a by-stander country nor any source of distortion
like externality, increasing returns. government intervention
or imperfect competition.
Koji SHIMOMURA
Research Institute for Economics and Business Administration
Kobe University
Rokkodai-cho, Nada-ku, Kobe
657-8501 Japan
Phone: (81) 78 803 7036
Fax: (81) 78 803 7059