Shehryar90
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Capital Share of Income in small open Economy
Shehryar90 replied to Shehryar90's topic in Economics Forum
Yea. Else I am going to get a D or probably an F :-( -
Question: We know that in the long run open economy, the real interest rate in the small open economy (SOE) is determined by the world real interest rate. Given that: What does this imply for the Capital Share of Income in the small open economy? Can taxes be used in this scenario to redistribute income (in small open economy)? I am looking for economic intuitive answers here. Regards