Djajic, Slobodan; Lahiri, Sajal; Raimondos-Møller, Pascalis - Economic Policy Research Unit (EPRU), Økonomisk Institut
This paper examines the effects of a transfer on the intertemporal terms of trade in the context of a simple two-country, two-period model. When intertemporal trade occurs because the two economies have different rates of time preference, a transfer entails an improvement in the terms of trade...