INTERNAL BALANCE, EXTERNAL BALANCE AND RELATIVE SIZE

Abstract

In a recent contribution to this Journal, Imanuel Wexler and Stephen M. Miller (1975) analyse the appropriate policy measures by which a country can correct an external imbalance while adhering to a predetermined mix of domestic inflation and unemployment. Wexler and Miller concentrate their attention on a case in which the domestic inflation/unemployment target coincides with external defect. They assume that the authorities are willing to tolerate a given inflation/unemployment mix but wish to erradicate the external imbalance. This problem is analysed within the context of two assumptions about the domestic rate of inflation relative to the foreign rate.

Citation

RODNEY THOM, D. (1976), "INTERNAL BALANCE, EXTERNAL BALANCE AND RELATIVE SIZE", Journal of Economic Studies, Vol. 3 No. 1, pp. 69-75. https://doi.org/10.1108/eb008062