The Balance-of-payments Constraint: From Balanced Trade to Sustainable Debt

Nelson Barbosa-Filho

No 2001-06, SCEPA working paper series. from Schwartz Center for Economic Policy Analysis (SCEPA), The New School

Abstract: This paper extends the balance-of-payments constraint on growth known as Thirlwall's law to incorporate unbalanced trade and debt accumulation. Assuming that small open economies face a liquidity constraint, the text shows the growth and real-exchange-rate policy rules consistent with a stable ratio of net exports to income. Given such rules, the text shows how the trade balance of a small open economy is residually determined by the ratio of foreign debt to income allowed by international conditions.

Keywords: balance of payments constraint; trade; debt; growth (search for similar items in EconPapers)
JEL-codes: F30 F41 (search for similar items in EconPapers)
Pages: 25 pages
Date: 2002-01
New Economics Papers: this item is included in nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Downloads: (external link)
https://www.economicpolicyresearch.org/scepa/publi ... /2002/cepa200106.pdf (application/pdf)

Related works:
Journal Article: The balance-of-payments constraint:from balanced trade to sustainable debt (2001)
Journal Article: The balance-of-payments constraint:from balanced trade to sustainable debt (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:epa:cepawp:2001-06

Access Statistics for this paper

More papers in SCEPA working paper series. from Schwartz Center for Economic Policy Analysis (SCEPA), The New School Contact information at EDIRC.
Bibliographic data for series maintained by Bridget Fisher ().