NET-EXPORT EFFECT: A change in aggregate expenditures on real production, especially net exports through the foreign sector, that results because a change in the price level alters the relative prices of exports and imports. The net-export effect, also termed the international-substitution effect, is one of three effects underlying the negative slope of the aggregate demand curve associated with a movement along the aggregate demand curve and a change in aggregate expenditures. The other two are real-balance effect and interest-rate effect.

     See also | aggregate demand | aggregate expenditures | aggregate demand curve | real-balance effect | interest-rate effect | imports | exports | net exports | exchange rate | foreign |

NET-EXPORT EFFECT, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2024. [Accessed: April 19, 2024].

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Ceteris paribus factors, other than aggregate income or production, that are held constant when the aggregate expenditures line is constructed and which cause the aggregate expenditures line to shift when they change. Some of the more important aggregate expenditures determinants are interest rates, expectations, fiscal policy, wealth, and exchange rates.

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