Trade, Transfers, and Monetary Overhangs

  • Lester D. Taylor


In this chapter, we turn to questions involving international trade and the transfer of wealth from one country to another or from one region within a country to another. The focus, initially, will be on the emergence of trade between two previously closed monetary economies and the factors which influence the exchange rate established between their respective currencies. Following this, we will turn to transfer questions involving “monetary overhangs” and how they are related to the conservation laws imposed by the pool of fluid capital. Two examples will be considered, the first the “capital levy” proposed by Schumpeter for Austria at the end of WWI, the second the reunification of Germany in 1990 following collapse of the Berlin Wall.


Exchange Rate Real Income Monetary Union Ownership Share Money Stock 
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Copyright information

© Springer Science+Business Media, LLC 2010

Authors and Affiliations

  1. 1.Department of EconomicsUniversity of ArizonaTucsonUSA

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