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FACTOR ACCUMULATION AND THE TERMS OF TRADE: APPLICATIONS TO THE ASIAN FINANCIAL CRISIS
Author(s) -
Choi E. Kwan,
Beladi Hamid
Publication year - 2006
Publication title -
pacific economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.34
H-Index - 33
eISSN - 1468-0106
pISSN - 1361-374X
DOI - 10.1111/j.1468-0106.2006.00322.x
Subject(s) - economics , welfare , population , capital (architecture) , financial crisis , capital accumulation , international economics , population growth , terms of trade , monetary economics , macroeconomics , human capital , market economy , geography , demography , archaeology , sociology
. This paper investigates the effects of population growth and capital accumulation on trade and welfare. In the absence of a terms of trade effect, an population increase reduces the standard of living and causes a reduction in welfare. An increase in population causes deterioration in the terms of trade of a labour abundant country, whereas capital accumulation improves them, regardless of the source of growth. Moreover, an increase in the South's population is immiserizing.