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permanent component of the terms of trade may lead to higher rates of private savings. Agénor and Aizenman examine the extent to … which permanent terms-of-trade shocks have an asymmetric effect on private savings. Using a simple three-period model, they … long trough rather than a sharp peak), savings rates will respond asymmetrically to favorable movements in the permanent …
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The relationship between international payments and the real exchange rate - the ‘transfer problem’ - is one of the classic questions in international economics. In this paper we use cross-country data on real exchange rates and a newly constructed data set on countries’ net external...
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