Chages in price levels thus play the predominat role in bringing about the necessary adjustment of import ad export balaces

In the account, chages in price levels thus play the predominat role in bringing about the necessary adjustment of import ad export balaces, ad are assisted only by fluctuations in exchage rates, held to be a factor of minor importace. In recent years a number of writers, most notably Ohlin, have contended that such a account leaves out of the picture a importat equilibrating factor. These writers insist that much, or even all, of the equilibrating activity commonly attributed to relative price chages is really exercised by the direct effects on import ad export balaces of the relative shift, as between the two regions, in the amounts of meas of payments or in money incomes; that when disturbaces in international balaces occur, the restoration of equilibrium will or ca take place unaccompaied by relative price chages or accompaied by only minor chages in relative prices; ad that such chages if they do occur will not be, or are not likely to be, or need not necessarily be—which of these is supposed to be the fact is not always made clear—of the type postulated in the later classical doctrine as expounded by J. S. Mill or Taussig. While none of these writers seems to have applied his doctrine to a currency disturbace such as postulated by Hume, where the need for at least temporary price chages of some kind would seem most obvious, it mightbe assumed, nevertheless, that they would hold Hume's aalysis of the mechaism to be inadequate even when confined to such cases.