International Stagflation and the 'Locomotive Hypothesis'

Kau mann, Hugo M. A icle In e na ional S ag la ion and he 'Locomo i e Hypo hesis' K edi und Kapi al P o ided in Coope a ion wi h: Duncke & Humblo , Be lin Sugges ed Ci a ion: Kau mann, Hugo M. (1982) : In e na ional S ag la ion and he 'Locomo i e Hypo hesis', K edi und Kapi al, ISSN 0023-4591, Duncke & Humblo , Be lin, Vol. 15, Iss. 2, pp. 227-250, h ps://doi.o g/10.3790/ccm.15.2.227 This Ve sion is a ailable a : h ps://hdl.handle.ne /10419/292925 S anda d-Nu zungsbedingungen: Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen Zwecken und zum P i a geb auch gespeiche und kopie we den. Sie dü en die Dokumen e nich ü ö en liche ode komme zielle Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich machen, e eiben ode ande wei ig nu zen. So e n die Ve asse die Dokumen e un e Open-Con en -Lizenzen (insbesonde e CC-Lizenzen) zu Ve ügung ges ell haben soll en, gel en abweichend on diesen Nu zungsbedingungen die in de do genann en Lizenz gewäh en Nu zungs ech e. Te ms o use: Documen s in EconS o may be sa ed and copied o you pe sonal and schola ly pu poses. You a e no o copy documen s o public o comme cial pu poses, o exhibi he documen s publicly, o make hem publicly a ailable on he in e ne , o o dis ibu e o o he wise use he documen s in public. I he documen s ha e been made a ailable unde an Open Con en Licence (especially C ea i e Commons Licences), you may exe cise u he usage igh s as speci ied in he indica ed licence. h ps://c ea i ecommons.o g/licenses/by/4.0/ In e na ional S ag la ion and he 'Locomo i e Hypo hesis' By Hugo M. Kau mann, New Yo k I. In oduc ion A e he 1973/74 oil shock, he down u n and hen he eco e y a es o economic ac i i y among he wes e n indus ialized coun ies (among which Japan is con en ionally included) p oceeded along di e en pa hs. In an a emp o accele a e eco e y and dis ibu e g ow h mo e e enly among coun ies, he 'locomo i e' hypo hesis was p omo ed. The idea was ha he s onge coun ies would engage in in ensi ied ex- pansiona y economic policies he eby pulling he mo e slowly g owing o s agna ing coun ies along wi h hem. Cu en economic de elopmen s a e eminiscen o he i s oil shock. This jus i ies u he discussion and illumina ion o he locomo i e a gumen . Rising in la ion a es in he wes e n indus ialized na ions, combined wi h and pa ly caused by uel p ice inc eases, as well as inc eases in he p ices o o he aw ma e ials aise he dis inc possibili- y, i no p obabili y, ha he ecession which he Uni ed S a es ex- pe ienced in he i s hal o 1980 may no ye ha e been ully anquished and ha a wo ld-wide ecession will de elop in 1981. The spec e has become isible, e en hough he combina ion o ecession wi h in la ion — he so-called s ag la ion — migh u n ou o be less se e e and o sho e du a ion han he down u n expe ienced a e he oil shock o 1973. The 1974/75 in e na ional ecession, he wo s in he pos -Wo ld Wa II pe iod, came in he wake o OPEC's quad upling o he oil p ice wi hin a e y sho ime span, and his a a ime when he unde lying s eng h o he economies was al eady ading. While he mo e ecen p ice inc eases, amoun ing o abou 150 pe cen so a ha e no ye been o he same magni ude, his ac alone is no gua an ee ha he e ec will be less se e e. Fo he base om which he p ice hikes ha e aken o is subs an ially abo e he o me one. Secondly, in la ion and unemploymen a es a e wo se now han in 1973. Thi dly, OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 228 Hugo M. Kau mann uel supply has become a he mo e uns able in spi e, o e en because o highe uel p ices, and supplies may become e e mo e unp edic - able as a consequence o poli ical and ecomomic ins abili y wi hin OPEC. And las bu no leas , mo e p ice inc eases and possible cu - backs in supply a e pending.1 Business cycle his o y and heo y ins uc us ha no wo cycles a e iden ical in hei causa ion, ampli ude o du a ion. This obse a ion pe ains bo h o cycles which emain con ined wi hin a na ion and o hose which c oss na ional bounda ies. Thus, we need no en ision he ine i abili y o a epea pe o mance o he p e ious ecession. Simila i ies wi h he onse o he p e ious down u n do exis , such as he apid inc ease in impo p ices and de e io a ion in he e ms o ade o indus ialized na ions. Bu some o he dissimila i ies wi h he p e ious peak o he cyclical expansion may be cause o mo e a he han less conce n. The ex e nal disequilib ia, i.e., balance-o - paymen s imbalances among he wes e n indus ialized na ions, a e dis ibu ed di e en ly om wha hey we e a he onse o he las ecession. Howe e , he in e na ional disequilib ia — in la iona y p es- su es and unemploymen — a e mo e p onounced nowadays. In he mon hs p eceding he down u n in he 1970s, in la iona y p essu es had been combined wi h high employmen and capaci y u iliza ion le els in an in e na ionally synch onized expansion. This ime, howe e , unemploymen is s ill a uncom o ably high le els in many coun ies, and capaci y u iliza ion seems o be below no mal, g ow h a es ha e d opped subs an ially om hei le el du ing he decade an eda ing he i s oil shock, while in la ion has been accele a ing. A i s blush, one migh conclude ha he p e ious gene al down- u n was accompanied by a policy dilemma o in e nal e sus ex e nal goals — how o lowe he unemploymen a e unde se e e balance-o - paymen s cons ain s — while we a e now aced wi h an in e nal policy dilemma in he coun ies a lic ed wi h high in la ion and unemploy- men a es. Howe e , his di e ence be ween he wo pe iods is mo e appa en han eal, o wo easons: i s , we ha e lea ned, o should ha e lea ned, om obse a ions o he pas ha he in la ion-unem- ploymen ade-o p esen s i sel o policy make s unde e y limi ed p e-condi ions, and hen only in he sho un. Secondly, wi h in la ion a es di e ging a an accele a ing a e, we can expec belance-o -pay- 1 The OECD es ima es ha he ini ial impac o each 10 pe cen inc ease in oil p ices educes he g ow h in GNP by 0.3 pe cen age poin s. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 229 men s disequilib ia o moun again, he eby wo sening he ex e nal policy op ions. Consequen ly, we ha e o eckon wi h he possibili y ha u u e p oblems will esemble hose a e he i s oil shock, and ha sug- ges ions o coping wi h hem will mo e along simila acks. The In e na ional Mone a y Fund (IMF) p oposed ha "each coun y should con ibu e o wo ld economic g ow h in ela ion o he s eng h o i s ex e nal posi ion and o i s p ice pe o mance."2 The O ganiza ion o Economic Coope a ion and De elopmen (OECD) made simila s a e- men s in he pas . Bu indi idual coun ies may be emp ed o call o a di e en pa h o ac ion, assigning he esponsibili y o adjus men o he so-called locomo i e coun ies, Ge many and Japan. My p esen a ion ocuses on se e al aspec s o he locomo i e a gu- men . Fi s , I shall in es iga e he idea i sel and i s ounda ion. Second I shall ask whe he he a ious heo e ical unde pinnings o his hypo- hesis we e well aken and whe he he a gumen could be suppo ed in ligh o he exis ing in e na ional mone a y and exchange a e sys em. The ques ion whe he he 'locomo i es' could ha e acceded o o he coun ies' demands in iew o he locomo i es' own in e nal economic and poli ical cons ain s has been deal wi h on a di e en occasion.3 II. The 'Locomo i e' Hypo hesis 2. The 'Locomo i e9 Hypo hesis Pe Se Since he oil shock o 1973, he wes e n indus ialized na ions ha e expe ienced, in he agg ega e, conside ably lowe g ow h a es han du ing he p eceding en o i een yea s. Coinciding wi h he poo pe o mance o he g ow h a es, and no un ela ed o i , in e nal im- balances inc eased: in la ion a es accele a ed conside ably and unem- ploymen a es se led on a highe pla eau, e en du ing expansiona y phases, han many coun ies had deemed accep able in he p eceding decade; employmen g ew, bu p oduc i i y gains d opped sha ply;4 2 IMF, Annual Repo 1979, p. 31. 3 Hugo M. Kau mann, "Ge many's Op ion o be a Mini-Locomo i e: A Reassessmen o 1977," Economia In e nazionale, 31 (3 - 4), Augus - No embe 1978, pp. 196-211. 4 The o e all gain o he se en majo indus ial coun ies amoun ed o only 1 -1/2 %> pe annum om 1973 o 1978, compa ed wi h an a e age inc ease o 3 - 3/4 pe cen o he 1960 - 1973 pe iod. (P oduc i i y measu ed by eal GNP pe pe son employed.) IMF, Annual Repo 1979, p. 7. Employ- men may ha e g own a he expense o p oduc i i y gains. 16 K edi und Kapi al 2/1982 OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 230 Hugo M. Kau mann and he ex e nal accoun s, measu ed on he cu en accoun basis, ex- hibi ed g ea e imbalances han be o e. In o he wo ds, in e nal as well as ex e nal imbalances in he 1970s exceeded hose o he 1960s. The 1974/75 ecession was synch onized among OECD coun ies, bu he in e nal-ex e nal disequilib ia we e dis ibu ed unequally among hem, in he wake o di e en policy esponses o he oil shock. Coun- ies which we e, o his o ical easons, mo e ea ul o in la ion, e.g., Ge many and Swi ze land ( he o me ha ing expe ienced he dis- as ous consequences o ampan in la ion wice wi hin a qua e cen u y), concen a ed hei a en ion o he in la iona y e ec o he oil p ice inc ease. O he s, such as F ance, I aly, he Uni ed Kingdom, and he Uni ed S a es, we e mo e conce ned abou he de la iona y impac . Ini ial policy esponses e lec ed na ional p e e ence unc ions. The o me g oup o coun ies engaged in less accommoda ing mone a y and iscal policies, mo e o less accep ing OPEC's oil p ice inc eases o wha hey eally we e — a ans e ax om oil impo ing o oil expo ing coun ies, equi ing in e coun y income ans e s. As such, oil p ice inc eases we e bound o ha e some de la iona y e ec s in he oil impo ing coun ies. The second g oup o coun ies, in hei a emp a e ading he eal ans e cos , engaged in expansiona y economic policies, he eby ueling he in la iona y o ces, wi hou ul ima ely escaping he adjus men bu den imposed by he oil ax. The di e ence was ha an in la ion ax ("hidden ax") was subs i u ed o an ou igh admission, bu poli ically less popula s ance, ha an oil ax had been imposed om he ou side. This la e g oup o coun ies ended up no me ely wi h g ea e ex e nal imbalances as hey esis ed he equi ed adjus men s; hei in e nal imbalances g ew wo se as well, as in la ion- a y dis o ions compounded he adjus men cos s connec ed wi h he oil ax. Like he disequilib ia, he adjus men bu den was unequally dis i- bu ed in he end. I was hus no oo su p ising ha coun ies wi h la ge disequilib ia and adjus men p oblems, i.e., hose which had s a ed om an un a o able in e nal-ex e nal posi ion and hose which engaged in he w ong policy esponse,5 would engage in a campaign o ge he mo e success ul ones o assume also pa o he adjus men bu den o he coun ies wi h he la ge disequilib ia. 5 This includes hose which s a ed om ela i ely a o able posi ions, e. g., he Uni ed S a es, and he no so a o ably posi ioned ones, e. g., I aly and he Uni ed Kingdom. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 231 To p epa e he g ound o his p oposal, coun ies we e classi ied as 'weak' and 's ong' based, wi h dubious jus i ica ion, upon hei ex e nal accoun posi ions, p ima ily hei ade o cu en accoun balances. This dicho omy was he ounda ion o he 'locomo i e' hypo hesis, which he OECD, oo, used in i s ecommenda ions o an i- ecessiona y poli- cies. Acco dingly, he 's ong' coun ies had he po en ial as well as he obliga ion o lead he way ou o he ecession, pulling he 'weak' OECD coun ies in ow. The po en ial was said o be he e, because he ex e nal su pluses o he locomo i e coun ies allowed hem o conduc expansiona y economic policies unhampe ed by ex e nal cons ain s.6 Mo eo e , i was supposed o be also in he locomo i e coun ies' e y own in e es o accele a e domes ic expansion o educe hei in e nal disequilib ia, i.e., unemploymen ; in la iona y p essu es would no be ekindled as long as hey ope a ed subs an ially below capaci y limi s. Pu succinc ly, he p oposal was ha a li le cos o hemsel es, he 's ong' coun ies would no only con ibu e o sol ing he o he s' economic p oblems, bu could eap subs an ial bene i s hemsel es by accep ing he locomo i e ole. 2. The Theo e ical F amewo k and I s E alua ion a) The Theo e ical F amewo k A he base o he locomo i e a gumen lay he assump ion ha dis- c e iona y, ac i is go e nmen in e en ion — p ima ily in he o m o mone a y and iscal policy, bu also o incomes policy, i need be — would be e icien in achie ing policy goals. The heo e ical amewo k wi hin which he ad oca es o he locomo i e hypo hesis ope a ed was, implici ly a he han explici ly, essen ially Keynesian. I consis ed o ou assump ions: he exis ence o a mul iplie e ec (i no also ac- cele a o and mul iplie -accele a o in e ac ion); he exis ence o an in e na ional ansmission mechanism o domes ic economic ac i i y, i.e., an in e na ional mul iplie , be i ing a sys em o ixed exchange a es; an en i onmen o money illusion, i.e., o p ice s abili y, whe e changes in money incomes we e p ecei ed as changes in eal incomes. Finally, all would all in o p ope place because o he con inued exis ence o an in la ion-unemploymen ade-o , ha could be ob- 6 As used o be he case wi h England's 's op and go' policies du ing much o he 1960s. 16* OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 232 Hugo M. Kau mann se ed since he la e 19 h cen u y — he so-called Phillips cu e phenomenon. Unde hese pe cei ed p econdi ions i became incumben upon he s onge coun ies o se in o mo ion accele a ed domes ic g ow h by engaging in expansiona y demand policies. Policy-induced budge a y de ici s ( iscal policy, he Keynesian policy ool pa excellence) we e p esc ibed, which we e o be assis ed by accommoda ing mone a y policy. Wi h his policy-induced accele a ed g ow h he in e na ional mul i- plie would be igge ed as inc eased domes ic economic ac i i y spilled o e in o he weake coun ies ia he ma ginal p opensi y o impo . Consis en wi h Keynesian doc ine was he pe cep ion o cu en accoun su pluses (de ici s) as e idence o de icien (excessi e) domes ic abso p ion. Wha seemed o be subs an ial unused p oduc i e capaci y in su plus coun ies a e 1974, len added suppo o such an in e p e a- ion o cu en accoun su pluses. Thus, inc eased domes ic abso p ion would educe excess capaci y in he home coun y and, h ough he ma ginal p opensi y o impo , educe he ex e nal imbalances o su plus and de ici coun ies alike. This, in u n, would educe he ex e nal cons ain s o expansiona y policies in he weake coun ies, acili a ing hei domes ic eco e y. These coun ies we e p esumed un- able o engage in expansiona y policies wi hou simul aneously wo sen- ing hei al eady p eca ious in e nal-in la iona y and ex e nal — balance o paymen s — posi ion. b) E alua ion o he Theo e ical F amewo k (1) E ec i eness o Economic Policy The assump ion ha (go e nmen al) disc e iona y policies could be e ec i e has been challenged on se e al on s. The ea lie a ack cen e ed on he ela i e e iciency o mone a y policy e sus iscal policy along he lines o mone a is s e sus Keynesians. La e he ques ion a ose as o hei ela i e e iciency unde a sys em o ixed (o pegged) exchange a es compa ed o ha unde a egime o lexible exchange a es. Mo e ecen ly, all o ms o disc e iona y policies came unde he sc u iny o he ' a ional expec a ions' heo y, acco ding o which p ope ly an icipa ed policies o he economic au ho i ies ha e no impac on economic ac i i y.7 7 Fo a con enien summa y o he mo e impo an c i icisms ha ha e been launched agains he e icacy o ac i is policy measu es, see Robe J. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 233 E en wi hou going o he ex eme o he a ional expec a ionis s, we now know ha he con idence in he success o disc e iona y eco- nomic policies, he so-called ' ine- uning', p e alen in he ea ly 1960s, had been o e done and was apidly waning in he la e 1960s. Some o he doub s in he success o ine- uning had o do wi h he exis ence and unp edic able a iabili y o ime lags — he inside and ou side lags — as well as wi h hei impac upon he a iables and hei in- cidence.8 I became e iden ha he (expansiona y o con ac iona y) policies migh become e ec i e jus a he ime when opposi e policies would be called o . Thus, bo h he lags and he a ional expec a ions a gumen s suppo he ecommenda ion o ely on ules a he han on ac i is policies. Mo eo e , i has been shown ha he e is he cons an dange o o e - shoo ing when — wi h unce ain domes ic and o eign- ade mul iplie s — expansiona y (con ac iona y) policy is adop ed o close a de- la iona y (in la iona y) gap.9 I such a dange exis s o he closed economy, i is e en mo e likely o be p esen in exagg ega ed o m o he open economy, depending on he exchange a e egime. Unde ixed exchange a es, his dange o he domes ic economy is educed. The in e na ional spillo e e ec (which, in he locomo i e a gumen is desi ed and coun ed upon) mo es in o o he coun ies some o he 'exagge a ions'. Ne e heless, he co ec magni ude and he dis ibu- ion o he impac o policies be ween he eal and he mone a y sec o s a e s ill unce ain, and wi h hem he eedback om and upon loco- mo i e coun ies. Aside om he sho comings connec ed wi h hese mo e ecen ind- ings conce ning he e icacy o disc e iona y policies, he e a e o he Go don, "Wha Can S abiliza ion Policy Achie e?" Ame ican Economic Re iew, 68 (2), Pape s and P oceedings, May, 1978, pp. 335 - 338. 8 The ecogni ion lag has o be di ided in o wo pa s, he ecogni ion ha , say, a down u n has s a ed, and secondly, whe he i is cyclical o s uc u al in na u e. This is he closed-economy equi alen o he ques ion in in e - na ional economics whe e balance o paymen s had o be classi ied as empo a y- andom, cyclical o ' undamen al', unde he B e on Woods sys em. Only he la e disequilib ium would ha e jus i ied (o equi ed) exchange a e changes. O cou se, con lic s a ose among coun ies in he in e p e a ion o hei disequilib ia: wha one coun y saw as i s own andom o cyclical ex e nal disequilib ium was equen ly seen as ' undamen al' by he ou side s. 9 William C. B aina d, "Unce ain y and he E ec i eness o Policy," Ame ican Economic Re iew 57, May 1967, pp. 411 - 425. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 234 Hugo M. Kau mann undamen al misgi ings one can exp ess wi h he basis o he locomo- i e hypo hesis. I shall now u n o he mo e signi ican ones. (2) Money Illusion I is s ange ha money illusion, which p esupposes a pe iod o p ice s abili y, was s ill assumed in he mid-1970s. Fo one, he condi ion o he p eceding decade ha dly wa an s such an assump ion. While we a e no in he ex eme classical wo ld o pe ec o esigh ega ding p ice changes, and some money illusion exis s in he sho un, i does no i he wo ld o he 1970s. Since p ice expec a ions a e o med on pas p ice pe o mance, in la ion expec a ions a e buil in o he sho un beha io , oo, a e he lea ning p ocess has occu ed. In la ion ex- pec a ions a e inco po a ed no only in o m o 'indexing/ bu also in o he o ms o cos o li ing adjus men s, leap ogging, and by sho en- ing he du a ion o labo con ac s, o educe he ime lag be ween p ice changes and wage adjus men s. This being he case, we mo e u he away om he Keynesian ealm and migh be in he 'long un' by now. As labo is expec ed o educe i s eal income, he Phillips cu e phenomenon depends en i ely on labo 's pliabili y. Ano he eason o money illusion o be a a he cu ious assump ion in he special si ua ion unde e iew has o do wi h he locomo i e hypo hesis i sel . I coun ies a e encou aged o s imula e ecomomic ac i i y e en wi h he likelihood ha he in la ion a es would e- accele a e, hen money illusion could no longe be coun ed on; he na ion, and wi h i he con ac ing pa ies, ha e been o ewa ned ha in la ion which s ill had no been b ough unde con ol, would be e- kindled — a bes , only sligh ly. The mo e ecen discussion o he Philipps cu e phenomenon has clea ly es ablished ha he in la ion unemploymen ade-o , i i e e exis ed as a policy ins umen , was ope a i e only in he sho un, and as long as p ice s abili y was assumed by wage ea ne s. A he me ela ed o he 'Keynesian' ha employmen can be s imula - ed wi hou much in la iona y impac un il an economy eaches he capaci y ou pu le el is ha his also holds i espec i e o he speed wi h which capaci y ou pu is being app oached.10 10 This can be ound in a gumen s o he Join Economic Commi ee, e. g., in i s 1976 Economic Repo (pp. 41 - 42) and i s 1976 Mid-Yea Re iew o he Economy (p. 20), whe e i has been s a ed ha "a a ime when e e y majo sec o o he economy is ope a ing a below capaci y, apid g ow h OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 241 The balance o paymen s implica ions o he weake coun ies, how- e e , we e di e en om he in la iona y ones. Expansiona y policies by he weake coun ies would u he he p eca iousness o hei ex- e nal posi ion, inc ease he loss o in e na ional ese es, which may- ha e been low o begin wi h. This line o easoning dis ega ds one o he undamen al di e ences be ween a sys em o ixed (o in e mi en - ly pegged) exchange a es and one in which he balance o paymen s impac can be abso bed by changes in he exchange a es. Unde he o me sys em, se e e es ic ions — especially on capi al ansac ions, bu also on me chandise ade — we e o en in oduced as he balance o paymen s de ici coun ies los in e na ional ese es o main ain he pegged exchange a es. Bu a sys em o eely luc ua ing exchange a es would no encoun e any ese e losses a all. As a ma e o ac , ese e changes a e an indica o o he absence o eely loa ing ex- change a es and o he deg ee o o icial in e en ion. (6) Exchange Ra e Flexibili y and Policy Op ions Also o e looked was he po en ial impac o a loa ing exchange a e sys em upon he locomo i es hemsel es and upon hei in luence on he weake coun ies. The e seems o be an in e nal inconsis ency in ha ing locomo i es a ached o a lexible exchange a e sys em: coun ies ha e op ed o a sys em o g ea e exchange a e lexibli y o gi e he pa i- cipan s in he loa ing sys em an addi ional deg ee o eedom, i.e., an added policy ins umen which would be un e e ed by ex e nal-accoun conside a ions. One can, he e o e, eason ha he decision o add his ool exp esses a social p e e ence unc ion — he o he op ion being o pa icipa e in he — hen al eady exis ing — Eu opean Join Floa Sys em. I am no igno ing he ac ha we a e dealing wi h an ex- change a e sys em o 'managed' loa a he han wi h one in which exchange a es a e le o e lec ma ke o ces exclusi ely. Wha does ma e , howe e , is ha some coun ies — England, F ance, and I aly, o men ion he majo Wes -Eu opean coun ies only — op ed o loa independen o he join loa . This loose join loa ag eemen las ed ill Ma ch 1979, when he Eu opean Mone a y Sys em (EMS) came in o o ce. Exchange a e mo emen s unde he loa ing exchange a e sys em had inc eased he ex e nal alues o he s ong coun ies, hus inc eas- ing he o eign-cu ency p ices o hei expo ables and dec easing he Deu sche Ma k (DM), Swiss ank (S .) o yen p ices o impo ables. The OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 242 Hugo M. Kau mann exchange a e mo emen , in u n, weakened he s ong coun ies' im- po -compe ing goods sec o . Mo eo e , he app ecia ion o hei cu en- cies made hem less compe i i e in hi d ma ke s as well. E en i he mone a is a gumen is co ec and exchange a e mo emen s ha e no las ing e ec on ela i e p ices and employmen , bu only on p ice le els, in he sho un he ou come is di e en . Thus, i he s ong coun ies' mone a y and iscal au ho i ies engaged in expansiona y policies beyond he ange chosen by hem in 1976 - 1978, hey migh ha e o ced he ex e nal alues o hei cu encies down and enhanced hei in e na ional compe i i e posi ion — a leas in he sho un. Would his ac ion ha e won he app o al o he weake coun ies? (7) In e na ional Capi al Mobili y Mone a y dis u bances and capi al mo emen s which would be se in o mo ion by hese dis u bances we e as much as igno ed as he loco- mo i e a gumen concen a ed on he eal sec o . Unde condi ions in which la ge scale capi al lows a e highly in e es elas ic, and wi h he exis ence o a well de eloped Eu o-cu ency ma ke , he ailu e o include he mone a y sec o mus be cu ious — and his no only o 'ex eme mone a is s'. The assumed amewo k would no ha e been much mo e app op ia e o a sys em o pegged exchange a es, bu ce ainly was no o he in e na ional mone a y sys em as i e ol ed since 1973. The ounda ion o a smoo hly unc ioning pegged exchange a e sys em — i.e., one in which no ade no capi al low ba ie s a e in oduced me ely o pe pe ua e a ' undamen al disequilib ium' — is ha he cen al bank ende s o eign cu ency a pe ec subs i u e o domes ic cu ency on he supply side.24 The nominal money supply be- comes hus an endogenous a iable, which no longe is unde he policy con ol o he cen al bank. To inc ease o e-es ablish mone a y con- ol unde he pegged- a e sys em a a ime o disequilib ium in he o eign exchange ma ke — when he demand o o eign balances exceeds wha he mone a y au ho i ies deem desi able o ole able, and when he cen al bank is losing in e na ionally accep able ese es — he supply subs i u abili y is discon inued. Ba ie s o exchange con- e ibili y a e in oduced, i.e., some o m o non-p ice a ioning o main- ain pegged a es. 24 Th ough i s in e en ion he cen al bank c ea es an in ini ely elas ic supply o o eign cu ency, i.e., an in ini ely elas ic demand o he home cu ency. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 243 On he o he hand, i seems ha pe ec ly lexible exchange a es do no gua an ee comple e independence o mone a y policy, whe e cu - ency subs i u abili y exis s.25 Risk o exchange con ol, o eezing o o eign-held asse s o hei na ionaliza ion educes he deg ee o subs i- u abili y o o eign o domes ic asse s. Bu as long as he posi i e isk di e en ial does no become p ohibi i e, capi al mo emen s canno be igno ed in policy ecommenda ions. T ue, in he sho un, whe e s ock analysis o asse s is mo e ap- p op ia e han low analysis26 and unde pe ec ly lexible exchange a es and ic ionless ma ke s, po olio disequilib ia (owing o changes in he eal money supply o in e es a es) would be co ec ed by ex- change a e changes a he han capi al lows. Bu in he longe un, capi al lows would ake place. Unless capi al mo emen s a e p ohibi - ed, we mus expec highe incomes (and hus sa ings) o inc ease de- mand no only o addi ional domes ic bu also o eign secu i ies.27 The ela i e be e p ice pe o mance in Ge many and Swi ze - land made he s ong coun ies' cu encies mo e a ac i e as a s o e o alue; he DM, mo eo e , became also an a ac i e ansac ions cu - ency. Thus, po olios included asse s in he denomina ion o hose cu encies. (8) Coun y Classi ica ion So a we ha e adop ed he commonly used e ms 's ong' and 'weak' coun ies, as hey we e ca ego ized by he p oponen s o he locomo i e hypo hesis. We now ha e o e alua e he alidi y o his coun y classi ica ion. G a e doub s a ise wi h espec o he classi ica ion o coun ies in o s ong and weak ones acco ding o hei ex e nal bal- ances, o which he ade o cu en accoun balance se ed as ya d- s ick. Bu nei he he ade balance, which is closely linked o he na io- nal income accoun , no he cu en accoun ansac ions include capi al mo emen s. Li le in e ence can be d awn om he ade o he cu en accoun abou a coun y's ex e nal posi ion, and ce ainly no abou i s 25 Ma c A. Miles, "Cu ency Subs i u ion, Flexible Exchange Ra es, and Mone a y Independence," Ame ican Economic Re iew, 68 (3), June 1978, p. 429. 28 This is so because he ole o domes ically held secu i ies is la ge ela i e o he low demand o changes in ha s ock. See John B. Bea e, Mac o- economics: Cycles, G ow h, and Policy in a Mone a y Economy. New Yo k: Macmillan, 1978, pp. 329 . 27 Bea e, ibid., pp. 328 ., oo no e 23. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 244 Hugo M. Kau mann ela i e s eng h o weakness, ei he o e ime o in compa ison o o he coun ies, and hus no policy measu es ough o be based o sugges ed by e e ing o wha migh u n ou o be misleading indica- o s. Ye ade- o cu en -accoun su plus coun ies ha e been accused o being 'bad c edi o s' by es aining domes ic demand, hus c ea ing de ici s in o he coun ies. Implici in his judgmen is he assump ion ha su plus is an indica ion o unning one's own economy below p oduc i e capaci y, so ha he size o he su pluses becomes an indica- o o he po en ial ou pu gap. While cyclical a ia ions a ec he cu en accoun , o he de e minan s, such as secula changes o changes in echnology and as e o di e ences in in la ion a es a e o he de- e minan s; some o hese changes c ea e excess capaci y, while o he s ha e educed i . The by now amilia J-cu e phenomenon, acco ding o which e alu- a ions and app ecia ions (de alua ions and dep ecia ions) i s inc ease balance o paymen s su pluses (de ici s) u he complica es sho - un in e p e a ions o balance o paymen s accoun s. Unde a uly lexible exchange a e sys em, balance o paymen s dis- equilib ia in he con en ional sense do no occu . The BIS and o he o icial ins i u ions ea disequilib ia in he same ashion as i hey had occu ed unde he pegged a e sys em o B e on Woods. Thus, he BIS concluded ha in e na ional adjus men s o balance o paymen s de ici coun ies emained as bu densome unde he lexible a e sys em as i was unde he ixed a e sys em. I dis ega ds he possibili y ha elimina ion o disequilib ia may dis up he economies o su plus coun- ies as well, when a cu ency ends o app ecia e oo apidly. I has been e en claimed ha he e is no eason why a lexible ex- change a e egime should make he adjus men in he cu en accoun au oma ic. Such imbalances a e pa and pa cel o a s ock adjus men p ocess. They e lec he su plus (de ici ) coun ies' desi e o accumula e (decumula e) a pa icula o m o weal h, namely o eign mone a y asse s, and as such a e no , pe se, some hing o be condemned o c i icized, no is he e a need o elimina e hem h ough go e nmen policies.28 As he 'mone a is ' in e p e a ion o balance o paymen s is di e en om he Kei/nesian, which emphasizes na ional income, so is he mo- ne a is in e p e a ion o exchange a e de e mina ion. Concen a ion 28 See Bal enspe ge , "The 1978 Annual Repo ...loc. ci ., p. 434. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 245 on cu en accoun disequilib ia o he balance o paymen s be ays he a achmen o he adi ional app oach acco ding o which exchange a es a e de e mined by imbalances in he cu en accoun s. Speci ically, acco ding o he Keynesian in e p e a ion, he sign, magni ude and pe sis encec o cu en accoun imbalances poin in he di ec ion o o e - o unde alua ion o a cu ency. Acco ding o he mone a is app oach, on he o he hand, he cu en accoun is only one o he de e minan s o exchange a es. To he mone a is , exchange a es a e de e mined in he ma ke o asse s, denomina ed in a ious na ional cu encies. Expec a ional ac o s play an impo an ole in he asse dis ibu ion and wi h i in he demand and supply condi ions o he a ious cu encies. Cu en accoun su pluses o de ici s, hus, a e endogenous o he adjus men p ocess and a e de e mined join ly wi h he exchange a e. O icial balance o paymen s in e p e a ions ha e gene ally paid no a en ion o hese in e ac ions be ween he a ious subaccoun s o he balance o paymen s. In con as o he 1940s und 1950s, when he capi al accoun was assumed o accommoda e he cu en accoun , he mode n e sion (e.g., Kou i, Mussa) assumes ha he cu en accoun adjus s o e ime o he exchange a e which is de e mined in he asse ma ke . We ha e "a ecu si e in e ac ion o e ime be ween exchange a es, balance o paymen s, and ne inancial weal h" which a e also in luenced by exchange a e expec a ions.29 Cu en accoun imbalances in his iew do no 'cause' exchange a e mo emen s, and hey may no be linked o each o he in a "unique and unambigous way."30 I his is he case, hen cu en accoun su pluses no longe a e e idence o unde alued cu encies. On he poli ical plane wo se s o cha ges, which we e inconsis en wi h each o he , ha e been le elled a he s ong coun ies: hey ha e been accused o main aining unde alued cu encies — unning cu en accoun su pluses. Then, as hei cu encies app ecia ed, hey we e said o d i e he p ice o hei cu encies up a i icially in o de o ge on he ' i uous' ci cle. In 1965, he Be ns ein Commi ee had wa ned ha no single balance o paymen s measu e should be used alone o assess a coun y's in e - na ional s eng h. This judgmen was la e ea i med by he Ad iso y 29 Assa Lindbeck, "App oaches o Exchange Ra e Analysis — An In o- duc ion," Scandina ian Jou nal o Economics, 78 (2) 1976, p. 142. 30 Bal enspe ge , "The 1978 Annual Repo ...loc. ci ., pp. 439 - 440. 17 K edi und Kapi al 2/1982 OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 246 Hugo M. Kau mann Commi ee on he P esen a ion o Balance o Paymen s S a is ics, which consequen ly ecommended he aboli ion o epo ing subaccoun s.31 Fu he mo e, he ade balance only e lec s he alue, no he olume o ade, and his ac plays an impo an ole o assessing coun ies unde a sys em o lexible exchange a es. Be ween 1977 and 1978 ade su pluses o Ge many ose, hough he olume o impo s in o Ge many inc eased, oo, and expo s ell signi ican ly. I was he e ms o ade e ec which swamped wha o he wise would ha e amoun ed o a de e io a ion in he ade balance. Some o he undamen al ques ions ega ding balance o paymen s in- e p e a ion and analysis can be aised in connec ion wi h na ional economic policy objec i es. I can be a gued ha in he anking o p io i ies o mac oeconomic goals — p ice s abili y, ull employmen , sa is ac o y g ow h a e, and balance o paymen s equilib ium — he ex e nal equilib ium goal ha dly e e anks on op, no would i be conside ed an independen goal, independen o o he coun ies' ac ions. Ra he , i is he esul o he pu sui o o he policy objec i es o he coun y unde in es iga ion as well as o ' he es o he wo ld/ As such, i is no he balance o paymen s o exchange a e mo emen s pe se which mani es social p e e ence unc ions, bu he balance o paymen s is he esidual, as i we e, o all he o he objec i es in in e - dependen and in e ac ing economies. Since he balance o paymen s e lec s he o ali y and in e ac ion o all he decisions which a e made by he na ionals and hei go e nmen s, i is well nigh impossible o p e en policy ac ions and eac ions om aiming a goals which a e i econcilable. To smoo hen hings, exchange a e lexibili y p o ides a be e amewo k han he B e on Woods sys em would ha e. We mus conclude ha building a case on spu ious balance o pay- men s in e p e a ion is a poo s a ing poin o assessing coun ies' ela i e s eng hs and o he locomo i e a gumen . 31 See he Repo o he Re iew Commi ee o Balance o Paymen s S a is- ics o he Bu eau o he Budge (Be ns ein Commi ee), The Balance o Paymen s S a is ics o he Uni ed S a es: A Re iew and App aisal, Ap il 1965; and he "Repo o he Ad iso y Commi ee on he P esen a ion o Balance o Paymen s S a is ics," in he S a is ical Repo e , Washing on: O ice o Managemen and Budge , June 1976. Consul u he Robe M. S e n e al., The P esen a ion o he U.S. Balance o Paymen s: A Symposium. Essays in In e na ional Finance, No. 123, Augus 1977. P ince on, N. J.: In e - na ional Finance Sec ion, P ince on Uni e si y. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 247 III. Conclusion Upon close inspec ion o he mo e impo an a gumen s o he locomo i e hypo hesis, which we e designed o induce he s onge coun ies o expand hei ac i i ies o hei own as well as he weake coun ies' bene i , we ind ha all o hem show weaknesses o in- consis encies o bo h. The coun ies o whom g ea e assis ance was expec ed did no poin o hese aspec s; a he hey ook e uge in s essing hei own in e nal cons ain s on bo h economic and poli ical g ounds.32 Wi h he locomo i e oad o ekindling economic ac i i y on an in e - na ional scale as good as closed, in e na ional economic policy coo dina- ion p esen s i sel as a iable al e na i e. Coo dina ion would ha e o consis o mu ually ag eed upon and consis en economic policy ac ions. Coun ies may ha e o op o shock ea men wi h sho e ime lags a he han o g adualism wi h longe ime lags un il he adjus men s wo k hemsel es h ough. While such a policy choice is likely o be esis ed by some coun ies, i would con ain he ollowing majo ad an- ages: i would inc ease c edibili y o he se iousness o he policy make s. Mo eo e , p ac ical men and he o eign exchange ma ke s ha e a sho a he han a long ime ho izon. Thus, o educe he excessi e cu ency luc ua ions wi h he concomi an loss in social wel a e, as - ac ing policy in e en ion is p e e able o g adualism. We ha e expe ienced in he pas ha g adualism wo ks e y slowly, e en impe cep ibly — a leas in he beginning. Thus, he de e mina- ion o policy make s may be doub ed a home and ab oad. The c edi- bili y o policy ac ions and he willingness and abili y o policy make s o pe se e e, when policy measu es a e unpopula , may be ques ioned, especially as he poli ical cycle app oaches elec ion ime. A such ime, unpopula bu necessa y ac ions may be abandoned o e en supplan ed by opposi e policies. Simul aneously, he emp a ion o shi ing in o o he coun ies he esponsibili y o p ope policy ac ions o one's own lack o success 32 See Hugo M. Kau mann, "Ge many's Op ion o be a Mini-Locomo i e: A Reassessmen o 1977," Economia In e nazionale, 31 (3 - 4), Augus - No embe 1978, pp. 196-211; and "F om he 'Locomo i e Hypo hesis' o 'Conce ed Ac ion' — The Me amo phosis o an Idea," Economia In e nazio- nale, 32 (2 - 3), May - Augus 1979, pp. 267 - 282. 17* OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 248 Hugo M. Kau mann in he adjus men p ocess would be heigh ened. We would hen be back a he 'locomo i e' a gumen wi h i s limi a ions and doub ul ele ance. Zusammen assung Die In e na ionale S ag la ion und die „Lokomo i -Hypo hese" De 1978 - 1979 s a ge undene zwei e „ölschock" gab uns die Möglichkei , die wi scha lichen Folgen des 1973 - 1974 e olg en e s en ölschocks e neu du chzuspielen, wenn auch eine Vo he sage de genauen Auswi kungen de zwei en ölp eise höhung ode de dadu ch he o ge u enen Reak ionen un- möglich wa . Dahe is es on In e esse, die am An ang de on de Angebo ssei e aus- gelös en E schü e ungen in den g oßen wes lichen Indus ielände n (ein- schließlich Japan) he schenden konjunk u ellen Ve häl nisse zu e gleichen, sowie die poli ische Ku se und poli ischen Fehle zu analysie en, die de e s e Schock nach sich zog. Un e den als Rich linien ü eine Lösungs indung dienenden i ümlichen Vo s ellungen s and an e s e S elle die „Lokomo i - Hypo hese", wonach die als „s a k" bezeichne en S aa en sowohl die eigenen wi scha lichen P obleme als auch die de schwäche en S aa en dadu ch lösen soll en, daß sie eine expansionis ische binnenwi scha liche Poli ik e - olgen. Es wu de behaup e , daß eine in den „s a ken" S aa en be iebene expansionis ische Poli ik kaum zu eine zusä zlichen In la ion üh en wü de, da auch sie — und nich nu die schwachen S aa en — mi eine Kapazi ä s- auslas ung a bei e en, die e heblich un e dem Maximum lag. Nach He o hebung de Haup hesen de Lokomo i -Hypo hese, s ell die- se Bei ag die Gül igkei ih e heo e ischen G undlagen in F age. Die heo e ische G undlage des „Lokomo i en-A gumen s" basie e au Keynes*sehen Übe legungen und au dem Ve auen in die olkswi scha liche Feins eue ung. De Bei ag un e such , ob angesich s de En wicklungen in de ealen Wel und au G und de Wi scha s heo ie diese P ämissen ge- ech e ig wa en. Was geschah mi de Wi ksamkei on Wi scha spoli ik bei un e schiedlichen Wechselku ssys emen, mi de Geldillusion, mi de Subs i u ion zwischen A bei slosigkei und In la ion, mi Schä zungen de unausgenu z en P oduk ionskapazi ä en, und mi de Be o zugung eine Nach agebelebung s a eine Angebo ss imulie ung? Die Fes s ellung, ob die Nach age ode das Angebo ange eg we den müß e, beein luß die E - wa ungen, die in na ionale und in e na ionale poli ische En scheidungen ge- se z we den. Das Lokomo i en-A gumen schenk e im Rahmen eines lexiblen Wechsel- ku ssys ems dem Ein luß on Wechselku se ek en au na ionale Poli iken, Kapi albewegungen und au die in e na ionalen Auswi kungen on na iona- len Poli iken zu wenig Au me ksamkei . Die Basis ü die Eins u ung in schwache und s a ke Lände is agwü dig und eine Klassi izie ung wi d du ch das J-Ku en-Phänomen noch meh komplizie . Unausgeglichene OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 In e na ional S ag la ion and he 'Locomo i e Hypo hesis' 249 Leis ungsbilanzen müssen ielmeh im Lich e on Bes andsände ungen be- ach e we den. Fe ne können Wechselku se und Zahlungsbilanzen nich nu in eine Rich ung e mi el we den — eine Ta sache, die bei de In e - p e a ion on Zahlungsbilanzen zu leich e nachlässig wi d. Summa y In e na ional S ag la ion and he 'Locomo i e Hypo hesis' The second 'oil shock' o 1978 - 1979 made a eplay o he economic con- sequences o he i s oil shock o 1973 - 1974 possible, e en hough i was no possible o p edic he exac impac o and eac ions o he second oil p ice hike. I is hus o in e es o compa e he cyclical condi ions o he majo Wes e n indus ialized coun ies (plus Japan) a he beginning o he supply shocks and o analyse policies and policy mis akes in he wake o he i s ex e nal shock. Fo emos among he mis aken ideas, which se ed as guidance o a solu ion was he locomo i e a gumen ' acco ding o which coun ies, which we e designa ed as 's ong' coun ies, we e expec ed o sol e hei own and he weake con ies' economic woes by engaging in expansiona y domes ic economic policies. I was a gued ha expansiona y policies in he o me g oup o coun ies would ha dly lead o addi ional in la ion, since, hey oo, no only he weak coun ies, ope a ed subs an ially below capaci y le els. A e ha ing highligh ed he main ea u es o he locomo i e a gumen , his s udy ques ions he alidi y o he heo e ical unde pinnings o ha hypo hesis. The heo e ical basis o he 'locomo i e a gumen ' was Keynesian and con- idence in ie- uning economies p e ailed. The s udy in es iga es whe he he p emises we e jus i ied in ligh o de elopmen s in he eal wo ld and economic heo ies. Wha happened o he e ec i eness o economic policy unde di e en exchange a e egimes, o money illusion, o he unemploy- men -in la ion ade-o , o es ima ions o unused p oduc i e capaci y, and o he emphasis on demand a he han supply c ea ion? The de e mina ion o whe he demand o supply ough o be s imula ed has implica ions on wha can be expec ed o en ol e om na ional and in e na ional policy decisions. The locomo i e a gumen paid oo li le a en ion o he implica ons o he lexible exchange a e sys em upon exchange a e e ec s o domes ic policies, capi al mo emen s, and he in e na ional ansmission o domes ic economic policies. The basis o coun y classi ica ion in o weak and s ong ones is o dubious alidi y, and he J-cu e phenomenon u he complica es ca ego - iza ion. Cu en accoun imbalances may ha e o be seen in ligh o s ock adjus men s. Mo eo e , exchange- a e and cu en -accoun de e mina ion a e no unidi ec ional — a ac oo easily igno ed in balance o paymen s in e p e a ions. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38 250 Hugo M. Kau mann Résumé La s ag la ion in e na ionale e l'"hypo hèse des locomo i es" Fu -il impossible d'en p é oi les e ec s p écis ou les éac ions engend ées, le deuxième choc pé olie des années 1978 - 1979 nous a pe mis d'obse e à nou eau les conséquences économiques du p emie choc des années 1973 - 1974. Il é ai donc in é essan de compa e les si ua ions conjonc u elles des g ands pays indus ialisés occiden aux (Japon inclus) au débu des boule e - semen s p o oqués du cô é de l'o e e d'analyse les o ien a ions e les e eu s poli iques qu'en aîna le p emie choc. Pa mi les e eu s de concep ion au se ice de la eche che de solu ions, l'on ange a en p emiè e place 1'"hypo hèse des locomo i es" qui oulai que les E a s quali iés de " o s" ésol en leu s p oblèmes économiques p op es e ceux des E a s aibles en p a iquan une poli ique in é ieu e expansionnis e. E l'on a p é endu que pa eille poli ique de c oissance des E a s o s ne p odui ai pas un su c oî d'in la ion, ca ces E a s aussi — e pas seulemen les E a s aibles — a aillaien la gemen en-des-sous de leu s capaci és d'u ilisa ion de l'ou il. Ap ès a oi mis l'accen su les hèses p incipales de l'hypo hèse des locomo i es, l'au eu s'in e oge su la alidi é de leu s ondemen s héo i- ques. La base héo ique de 1'"a gumen des locomo i es" epose su les idées de Keynes e su la oi en une condui e de p écision de l'économie. L'é ude examine la jus esse de ces p émisses en se ondan su les dé eloppemen s du monde éel e su la héo ie économique. Qu'en u -il de l'e icaci é de la poli ique économique sous la coupe de sys èmes di é en s de aux de change, de l'illusion moné ai e, de la subs i u ion en e chômage e in la ion, des es i- ma ions des capaci és de p oduc ion inexploi ées, e de la p é é ence acco dée à la elance de la demande su la s imula ion de l'o e? La cons a ion que la demande ou l'o e doi ê e s imulée in luence les an icipa ions placées dans les décisions poli iques na ionales e in e na ionales. Dans un égime de aux de change a iables, l'a gumen des locomo i es oc oie op peu d'a en ion à l'in luence des e e s des cou s de change su les poli iques na ionales, les mou emen s de capi aux e les épe cussions in e na ionales des poli iques na ionales. La base de la classi ica ion en pays o s e aibles es p obléma ique, e le phénomène des cou bes y complique enco e la classi ica ion. Les déséquilib es des balances des opé a ions cou an es doi en plu ô ê e examinés dans l'op ique d'un ed essemen des mou emen s. Au su plus, les in es iga ions su les aux de change e les balances de paiemen s ne peu en s'opé e dans une seule di ec ion, ci cons ance op sou en négligée dans l'in e p é a ion des balances de paiemen s. OPEN ACCESS | Licensed unde CC BY 4.0 | h ps://c ea i ecommons.o g/abou /cclicenses/ DOI h ps://doi.o g/10.3790/ccm.15.2.227 | Gene a ed on 2023-01-16 12:47:38