International trade

Bibliographic data

Monograph

Identifikator:: 1758394757

URN:: urn:nbn:de:zbw-retromon-136209

Document type:: Monograph

Author:: Taussig, Frank William http://d-nb.info/gnd/120199459

Title:: International trade

Place of publication:: New York, NY

Publisher:: Macmillan

Year of publication:: 1927

Scope:: XXI, 425 Seiten; graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Part III. International trade under inconvertible paper

Collection:: Economics Books

340 INTERNATIONAL TRADE Adal trade; the only significant consequence of inflated prices was that a new set of counters came to be used. We have learned how un- duly simplified is this version of what happens in domestic trade; much more takes place within a country when paper money is put forth. Something more may happen also in the trade between countries. The logical corollary of the Ricardian simplification of the prob- lem has appeared recently in the purchasing-parity doctrine, That doctrine, as set forth more particularly by Professor G. Cassel, maintains that the rates of foreign exchange — the prices at which bills of exchange on one such country will sell in the currency of the other — are in accord with the range of general prices in the two; or rather, to state the doctrine more carefully, are in accord with the relative price levels — with the changes in general prices that appear in the two. If paper currency in country A is put out to such an extent that prices are doubled in that country; and if, on the other hand, paper issues in country B result in a quadrupling of prices in B; then in B bills of exchange on A will sell at twice the rates which prevailed before the respective paper issues. The new rates of foreign exchange will be on a parity with the altered price levels. In more refined and careful exposi- tions of the doctrine this bald and simple statement is somewhat qualified. Account is taken of disturbing influences, of irregulari- ties that conceal the main trend. Payments on other than mer- chandise account — government remittances, and invisible items of all sorts — are admitted to exercise for considerable periods an influence of their own on the rates of exchange, not directly con- nected with the price levels. It is admitted also that the actual deal- ings in bills commonly have a speculative character, and are affected for weeks and months by expectations and rumors concerning the economic and political future. But thru all the transactions, it is maintained, the same general trend appears — accordance of the foreign exchanges with the respective price levels; and in the end the first approximation is found to fit the facts. When once all the remittances, on merchandise account and on account of other items as well, have been arranged for and allowed for;

Access restriction

Copyright

fullscreen: International trade

Monograph

Chapter

Table of contents

Download

Monograph

Chapter

This page

Image fragment

Citation links

Citation recommendation