The Theory of Interstellar Trade

5 Pages Posted: 15 Sep 2010

See all articles by Paul R. Krugman

Paul R. Krugman

Princeton University - Woodrow Wilson School of Public and International Affairs; Centre for Economic Policy Research (CEPR); National Bureau of Economic Research (NBER)

Abstract

This article extends interplanetary trade theory to an interstellar setting. It is chiefly concerned with the following question: how should interest charges on goods in transit be computed when the goods travel at close to the speed of light? This is a problem because the time taken in transit will appear less to an observer traveling with the goods than to a stationary observer. A solution is derived from economic theory, and two useless but true theorems are proved.

JEL Classification: F10, F30

Suggested Citation

Krugman, Paul R., The Theory of Interstellar Trade. Economic Inquiry, Vol. 48, No. 4, pp. 1119-1123, October 2010. Available at SSRN: https://ssrn.com/abstract=1677120 or http://dx.doi.org/10.1111/j.1465-7295.2009.00225.x

Paul R. Krugman (Contact Author)

Princeton University - Woodrow Wilson School of Public and International Affairs ( email )

Princeton University
Princeton, NJ 08544-1021
United States
609-258-4570 (Phone)
609-258-2809 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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