double factoral terms of trade
- The purchasing power, in terms of the factors used abroad to produce imports, of a country's own factors as they produce exports. It thus accounts for both the net barter terms of trade and the factor productivities of its own factors in producing its exports, Ax, and of foreign factors in producing its imports, Am: DFTT = NBTT*Ax/Am = (Px/Pm)*(Ax/Am). In effect, this is the price at which domestic factors exchange, through trade, for foreign factors. Term introduced by Viner (1937).
- acronymDFTT (written as Double factoral terms of trade)
- double factoral terms of trade