Choi, E. Kwan; Jin, Hailong - In: International Review of Economics & Finance 29 (2014) C, pp. 47-56
This paper investigates whether China can benefit from a trade surplus in one period, using it to pay off the debt in the next period by manipulating the exchange rates. If the marginal utility of income is nonincreasing in the exchange rate, then the equilibrium exchange rates that yield a...