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This paper presents a general equilibrium model of a small open economy with monopolistically competitive retailers, inventories and durable goods. Following large devaluations, this model generates a collapse of imports,… Click to show full abstract
This paper presents a general equilibrium model of a small open economy with monopolistically competitive retailers, inventories and durable goods. Following large devaluations, this model generates a collapse of imports, a fall of retail sales and inventories and a gradual increase in retail prices. Besides, the model allows to explain a short-lived spike in retail sales of durable goods, observed during the recent devaluation episode in Russia in December of 2014.
Keywords:
durable goods;
large devaluations;
inventories imports;
retail sales;
goods inventories;
sales durable
Journal Title: Journal of Economic Dynamics and Control
Year Published: 2019
Link to full text (if available)
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Journal Title: Journal of Economic Dynamics and Control
Year Published: 2019
Link to full text (if available)
Share on Social Media: Sign Up to like & get
recommendations!