INTERREGIONAL ARBITRAGE AND THE SUPPLY OF LOANABLE FUNDS: A MODEL OF INTERMEDIATE FINANCIAL CAPITAL MOBILITY*

ABSTRACT This paper develops a model of regional financial markets which can encompass different degrees of spatial financial integration. The behavior of the system is analyzed under alternative assumptions about the time frame of analysis and the extent of the flexibility of interest rates. It is argued that links may exist between regional real and financial sectors even in the short run and that such links must, through the regional balance of payments, exist in the long run, even where there is perfect financial spatial integration. It is observed that these relationships have generally been ignored by regional economic model builders.     

Equilibrium and disequilibrium perspectives on regional labor migration

Some alternative models of labor migration in the United States are reviewed, with particular reference to the distinction between equilibrium and disequilibrium models of migration. The authors propose alternative tests to a model developed by Joseph Schacter and Paul G. Althaus "which explicitly recognize the stock-flow interactions between net migration and the distribution of regional population stocks and which make a clean distinction between equilibrium in the temporal and in the market-clearing sense."     

NEOCLASSICAL AND KEYNESIAN PERSPECTIVES ON THE REGIONAL MACRO-ECONOMY: A COMPUTABLE GENERAL EQUILIBRIUM APPROACH*

ABSTRACT Regional economic models typically either ignore prices altogether or simply treat them as exogenously determined. An unfortunate consequence of the neglect of prices is that model builders have been very much limited in the range of macroeconomic perspectives they have been able to bring to bear on regional economic issues. In this paper, we first explain how prices can be modeled endogenously at a regional level despite the paucity of data on regional prices. Using an illustrative interregional computable general equilibrium model for Malaysia, we then demonstrate how alternative macroeconomic visions of regional systems may be captured.