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Title: |
International
Transmission of Government Spending, Monopolistic Competition and
North-South Trade |
| Author: |
Anwar, Sajid |
| Author
Affiliation: |
Northern
Territory U |
| Source: |
International Economic Journal, Winter 1997, v. 11, no. 4, pp. 113-126 |
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Publication Date: |
Winter 1997 |
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Abstract: |
This paper utilises a North-South general
equilibrium model where South exports an intermediate good to North in
exchange for differentiated goods. The model is used to examine
international transmission of government spending and its welfare
implications. It is shown that an increase in government spending in
North (South) can increase (decrease) the number of differentiated goods
produced thereby decreasing (increasing) the degree of monopoly power in
North. Furthermore an increase in government spending in South can
decrease the welfare of North, but the impact of an increase in
government spending in North on the welfare of South cannot be
unambiguously determined. |
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