Abstract
The ‘specie-flow mechanism’ is an analytic version of automatic, or market, adjustment of the balance of international payments. In competitive markets with specie-standard institutions, behaviour will lead to national price levels and income flows consistent with equilibrium in the international accounts, commonly interpreted in this context to mean zero trade balances.
Keywords
- Balance of payments
- Cantillon, R.
- Comparative advantage
- Gervaise, I.
- Hume, D.
- Law of one price
- Malynes, G. de
- Marshall–Lerner condition
- Mercantilism
- Monetary approach to the balance of payments
- Price level
- Price-specie-flow mechanism
- Quantity theory of money
- Specie-flow mechanism
JEL Classifications
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsBibliography
Blaug, M. 1985. Economic theory in retrospect. Cambridge: Cambridge University Press.
Darby, M., and J. Lothian. 1983. The international transmission of inflation. Chicago: University of Chicago Press.
Fausten, D. 1979. The Humean origin of the contemporary monetary approach to the balance of payments. Quarterly Journal of Economics 93: 655–673.
Rotwein, E., ed. 1970. David Hume: Writings on economics. Madison: University of Wisconsin Press.
Yeager, L. 1976. International monetary relations: Theory, history, and policy. 2nd ed. New York: Harper & Row.
Author information
Authors and Affiliations
Editor information
Copyright information
© 2018 Macmillan Publishers Ltd.
About this entry
Cite this entry
Allen, W.R. (2018). Specie-Flow Mechanism. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_1460
Download citation
DOI: https://doi.org/10.1057/978-1-349-95189-5_1460
Published:
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
eBook Packages: Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences