1. A. Leijohnufvud, ‘Inflation and Economic Performance’, in M. Bruce Johnson and Gerald P. O’Driscoll (eds), Inflation or Deflation?, Boston Ballinger Press (1983).
2. CEPR Working Paper, no. 3;RI McKinnon,1983
3. This has been empirically shown in the case of Italy. See E. Grilli, P. Savona and J. Kregel, ‘Terms of Trade and Italian Economic Growth’, Banca Nazionale del Lavoro Quarterly Review, no. 143 (December 1982). A positive and significant relationship between investments and terms of trade was also found by the authors in estimating manufacturing sector investment functions for the main West European industrial countries and Japan. Statistical analysis also shows how movements in the net barter terms of trade (the more general concept) are heavily influenced by changes in the terms of trade of manufactures (the less general concept previously used). A direct link between output growth and terms of trade has been extensively ascertained by empirical research on industrial countries. See, for example, M. Bruno and J. Sachs, Macroeconomic Adjustment with Import Price Shocks: Real and Monetary Aspects, Stockholm, Institute for International Economic Studies (1979)
4. and P. De Grauwe, M. Fratianni and M. K. Nabli, Exchange Rates, Money and Output: The European Experience, London, Macmillan (1985).
5. See: P. Savona, ‘La Moneta in Keynes: Una Rivoluzione Consegnata allo Storia?’, Atti della XVII Riunione delia Societa Italiana degli Economisti, Milano, Giuffre (1973);