Abstract:This paper extends the Viner (1948, 1968)-Zou (1997) model of mercantilism by introducing money and foreign exchanges and reexamines macroeconomic effects of policy shocks. It is shown that in the long run, consumption and foreign asset accumulation increases as a result of stronger mercantilist sentiments, permanent increases in the consumption tax, increases in the monetary growth rate and purchases of foreign bonds; and in the short run, macroeconomic disturbances including the mercantilist sentiments, the monetary growth rate, and the consumption tax have negative effects on current consumption and positive effects on current foreign asset accumulation, while purchasing foreign bonds has positive effects on both current consumption and current foreign asset accumulation.

Keywords: Foreign Asset Accumulation; Mercantilism; Money; Macroeconomic Policies

JEL Classi…cation Numbers: E52, F31, F41

附件：Foreign Asset Accumulation, Macroeconomic Policies and Mercantilism.pdf