In the long term, for an economy to grow, the productivity per head should grow. Higher productivity, means higher output with lower costs. That would mean I can buy one unit of a good in the economy with higher productivity per head cheaper than in the other economy. Therefore the exchange rate should change to level out this price difference (the invisible hand). Anybody agree with this thought?
this economy sucks from withen. corporate hijack. stock exchange robbery via floor specialist. overspending and federal budget deficit. Fannie Mae & Freddie Mac to default on loans comming soon!
I agree. There are other factors, many factors, but on the surface I agree. http://utminers.utep.edu/tcford/docs/poptrade.html Hey Contrarion, you need to read that link you crazy misguided fool.