The Balance-of-Payments Constrained Growth Model in Transitional Economy: The Case of Bulgaria
Elena Spasova ()
Additional contact information
Elena Spasova: New Bulgarian University
A chapter in Economic Crisis, Development and Competitiveness in Southeastern Europe, 2016, pp 75-92 from Springer
Abstract This paper examines the growth dynamics of the Bulgarian economy in the last 20 years in the light of the concept of balance-of-payments (BOP) constrained growth developed by Anthony Thirlwall (Thirlwall’s Law). Thirlwall’s Law aims at evaluating a country’s growth rate consistent with internal and external economic equilibrium. It states that BOP equilibrium requires a rate of economic growth not exceeding the ratio of the income elasticity of a country’s exports to the income elasticity of its imports—giving focus on price and non-price competitiveness. The study aims to verify whether the balance-of-payments constrained growth approach is suitable for explaining the Bulgarian growth performance in the last two decades. To this end, an econometric analysis of the equilibrium (sustainable) growth rate of the Bulgarian economy according to the concept of the BOP constraint on growth is made and compared to the actual registered levels of growth. The analysis clearly demonstrates that the characteristics of Bulgarian external trade represent a constraint on the country’s growth dynamics and hinder the process of sustainable economic convergence with the developed world.
Keywords: Thirlwall’s law; Sustainable growth; Export-driven development; F32; F43 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: Track citations by RSS feed
There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-3-319-40322-9_5
Ordering information: This item can be ordered from
Access Statistics for this chapter
More chapters in Contributions to Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().