000 | 02718cam a22003137 4500 | ||
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001 | w2868 | ||
003 | NBER | ||
005 | 20211020114858.0 | ||
006 | m o d | ||
007 | cr cnu|||||||| | ||
008 | 210910s1989 mau fo 000 0 eng d | ||
100 | 1 |
_aAizenman, Joshua. _94613 |
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245 | 1 | 0 |
_aInward Versus Outward Growth Orientation in the Presence of Country Risk / _cJoshua Aizenman. |
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_aCambridge, Mass. _bNational Bureau of Economic Research _c1989. |
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_a1 online resource: _billustrations (black and white); |
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490 | 1 |
_aNBER working paper series _vno. w2868 |
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500 | _aFebruary 1989. | ||
520 | 3 | _aThe purpose of this paper is to model the role of trade dependency in determining the access of a developing economy to the international credit market, and its desirable growth strategy. With full integration of capital markets the choice with respect to the inwardness of a technology is irrelevant: investment will be channeled to the more productive sectors, independently of their trade inwardness, With limited capital market integration a given investment will generate two effects. The first is the standard, direct productivity effect that is associated with the change in future output. The second is the trade dependency externality, generated by the change in future bargaining outcomes due to the change in the trade dependency of the nation. With partial integration, investment that increases trade dependency is desirable. If the credit markets are disjoint due to partial defaults, higher trade dependency is disadvantageous. Thus, higher trade dependency generates a positive externality with partial integration of capital markets, and a negative externality with disjoint credit markets. We show that credit market integration is determined by the size of the indebtedness relative to the trade dependency, as reflected by the repayment burden that is supported by the bargaining outcome. The repayment bargaining outcome is determined by the sectoral composition of the economy and by the effective size of the developing and the developed economies. | |
530 | _aHardcopy version available to institutional subscribers | ||
538 | _aSystem requirements: Adobe [Acrobat] Reader required for PDF files. | ||
538 | _aMode of access: World Wide Web. | ||
588 | 0 | _aPrint version record | |
690 | 7 |
_aF - International Economics _2Journal of Economic Literature class. |
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710 | 2 | _aNational Bureau of Economic Research. | |
830 | 0 |
_aWorking Paper Series (National Bureau of Economic Research) _vno. w2868. |
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856 | 4 | 0 | _uhttps://www.nber.org/papers/w2868 |
856 |
_yAcceso en lĂnea al DOI _uhttp://dx.doi.org/10.3386/w2868 |
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_2ddc _cW-PAPER |
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_c345665 _d304227 |