Fukuda, Shin-ichi; Kon, Yoshifumi - East Asian Bureau of Economic Research (EABER) - 2010
foreign exchange reserves, utility-maximizing representative agents decide consumption, capital stock, and labor input, as … a permanent decline in consumption. However, when the tradable sector is capital intensive, the increase may enhance … investment and economic growth. We provide empirical support for our theoretical analysis using panel data from the Penn World …