01619cas a2200241 a 4500 AALejournalIMF008013 230101c9999 xx r poo 0 0eng d 15.00 USD 9781451930733 1020-7635 BD-DhAAL BD-DhAAL International Monetary Fund. Research Dept. IMF Staff papers : Volume 35 No. 4. Washington, D.C. : International Monetary Fund, 1988. 1 online resource (204 pages) IMF Staff Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students An intertemporal optimizing model of a small open economy is used to analyze how terms of trade changes affect real exchange rates and the trade balance. Temporary current, (expected) future, and permanent changes in the terms of trade are considered. The results suggest that the relationship between the terms of trade and the current account (the so-called Harberger-Laursen-Metzler effect) is sensitive to whether the model incorporates nontradable goods. Thus, the real exchange rate may be an important variable through which terms of trade shocks are transmitted to the current account. Mode of access: Internet IMF Staff Papers; IMF Staff Papers ; No. 1988/004 Full text available on IMF http://elibrary.imf.org/view/journals/024/1988/004/024.1988.issue-004-en.xml IMF e-Library