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We utilize country‐level data to investigate the empirical linkage between an economy's industrial structure and the probability of a banking crisis. This paper shows that a higher share of the service sector tends to significantly increase the risk of a banking crisis. We also explore the potential channels through which the industrial structure may affect an economy's vulnerability to external shocks. The result of the analysis suggests that a higher share of the service sector substantially increases vulnerability to a banking crisis through deterioration in profits and worsening of the current account balance. Our study provides some implications for the recent acceleration of deindustrialization in several emerging and advanced economies: for example, the industrial policy should call for a more cautious approach to reduce the potential risks of deindustrialization (increase in crisis vulnerability). [ABSTRACT FROM AUTHOR]

The US has run a persistent current account deficit since 1982. Its growth particularly accelerated in the early 2000s, and the deficit peaked at about 6% of US GDP in 2006. Coincidentally, the distribution of income and wealth has grown progressively unequal, while the so-called financialization of the US economy has deepened. This article argues that the concomitant processes of persistent current account deficits, rising inequality, and deepening financialization are not merely coincidental but can be traced to common causes arising from the global restructuring of US production through foreign direct investment and offshoring, which has underlain the structural transformation of the US economy since the 1980s. On the one hand, the US is the world's biggest exporter of capital and recipient of foreign investment income; on the other hand, it is the biggest importer of foreign goods, often produced with the involvement of US capital. Ultimately, deindustrialization at home—a major factor behind the loss of middle-wage, middle-class jobs, and thus of rising income inequality—and the transnationalization of US production have boosted corporate profits, thereby propping up and accelerating the financialization of the US economy. [ABSTRACT FROM AUTHOR]

Copyright of Investigación Económica is the property of Universidad Nacional Autonoma de Mexico, Facultad de Economia and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Canadian Journal of Economics is the property of Wiley-Blackwell and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Despite being one of the world's major internationally traded services, tourism remains neglected within debates on European integration and growth models. We highlight the rise of tourism‐led growth in southern Europe and argue that the process of European integration has been a double‐edged sword, simultaneously incentivizing and forcing southern European economies to reap their comparative advantage in tourism. While European integration has created the preconditions for the expansion of intra‐European tourism, monetary integration pre‐empts macroeconomic management. Since the eurozone crisis, internal devaluation and fiscal austerity have suppressed the domestic growth drivers, inducing these governments towards an export‐led growth strategy. We document the emergence of unprecedented tourism‐related current account surpluses in southern Europe, driven strongly by tourism imports from the EMU core countries and the UK. Thus, while different export‐led growth strategies now coexist in the EMU, southern Europe's excessive reliance on international tourism for growth comes with severe pitfalls. [ABSTRACT FROM AUTHOR]

The aim of this study is to explore the empirical application of a previously unexplored procedure to systematically estimate and test the tenets of the balance of payments constrained growth (BOPCG) the model within a VECM framework. The three structural equations that constitute the BOPCG model are estimated as long run equilibrium relations using the Johansen cointegration analysis technique for Brazil, Korea, Mexico and Turkey over the 1980–2016 period. The BOPCG hypothesis is then tested in terms of non-linear coefficient restrictions on the cointegrating vectors. Hypotheses on the exogeneity of real exchange rate and the world income are also tested in terms of tests on the adjustment coefficients. Results provide evidence in favour of Thirlwall's Law for the cases of Brazil and Korea. [ABSTRACT FROM AUTHOR]

Copyright of Investigación Económica is the property of Universidad Nacional Autonoma de Mexico, Facultad de Economia and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Conventional views on the collapse of Bretton Woods suggest that it resulted from its own limitations. The inability of the United States to manage the system given the growing imbalances associated to the need of persistent current account deficits to provide liquidity in dollars, and the resulting inflationary pressures on the one hand, and the increasing disproportion of dollars and gold reserves, on the other, would bring about the end of the system. In other words, the Triffin Dilemma was ultimately correct, and the exorbitant privilege came with a high price tag. The limitations of the dominant view about Bretton Woods are discussed and it is argued that the end of Bretton Woods was a political decision that led to the consolidation of dollar hegemony. The limitations of the conventional view are ultimately tied to mainstream economics. [ABSTRACT FROM AUTHOR]

Copyright of Geosul is the property of Geosul and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

New Developmentalism is a theoretical framework being defined since the early 2000s searching to understand why most middle-income countries are falling behind the East Asian ones. It is a political economy and a development macroeconomics that originates from development economics and Post-Keynesian Macroeconomics. It argues that fast growth and catching up have been associated to developmentalism, not to economic liberalism. It defines the developmental state as the one that not only is engaged in industrial policy but also manages actively the five macroeconomic prices–mainly the interest and the exchange rate to keep competitive economically the companies that are technically efficient. New developmentalism is critical of fiscal indiscipline, while defends countercyclical fiscal policy, and is strongly critical of current account, arguing that growth is made at home. It has a new model of the Dutch disease from which is possible to deduce the means to neutralize it and achieve economic competitiveness. [ABSTRACT FROM AUTHOR]

Over the past two decades, economists have turned their attention to exploring the role of gender in the macroeconomy. This paper reviews the salient findings of that literature. Research shows that gender gaps in education, health, unpaid labor, employment, and wages have economy-wide consequences and influence the rate of growth. The effects are transmitted via both the supply side of the economy – principally through labor productivity – and the demand side – through business spending, exports, saving, and the balance of payments. In turn, a broad array of macro-level policies, including fiscal, monetary, and trade policies have differential effects by gender that, if unheeded, can undermine macro-policy goals. Their impact depends on the structure of the economy and the gender division of labor in paid and unpaid work. This survey makes clear that incorporation of gender into macro models improves the relevance of macroeconomic theory and can yield better policy results. [ABSTRACT FROM AUTHOR]

Why do some countries run persistent current account surpluses? Why do others run deficits, often over decades, leading to enduring global imbalances? Such persistent imbalances are the root cause of many financial crises and a major source of international economic conflict. We propose that differences in wage-bargaining institutions explain a large share of imbalances through their effect on the trade balance. In countries with coordinated wage bargaining, wage growth in export industries can be restrained to ensure competitiveness, leading to persistent trade surpluses. We estimate the contribution of these institutions to trade balances in Organisation for Economic Co-operation and Development (OECD) member countries since 1977 and find ample support for our hypothesis. Contrary to much of the literature, the choice of fixed or floating exchange rate regimes has only a small effect on trade or current account balances. In other words, internal adjustment in surplus countries via wage-bargaining institutions trumps external adjustment by deficit countries. [ABSTRACT FROM AUTHOR]

Until 1750 India was a thriving industrial manufacturing economy, producing 25% of the world's industrial output. From 2002 to 2012 Indian economy has run a trade deficit every year. It has the largest trade deficit with China which is $31 Billion. China is not amongst the top investing countries in FDI. There are certain forces which accelerate global manufacturing. These are huge factor cost differences, high growth in emerging markets and low transaction cost. India provides excellent opportunities for a global or multinational competitor to operate internationally from this country. Surprisingly China's bilateral trade with India grew from $0.2 Billion in 1990 to $13.6 Billion in 2004, without much progress in India's bilateral trade. Despite have a strategic location for sustaining global operations and quality logistics management, it failed. The essential factors which contribute to a decision of a firm to develop its operations considering India as an industrial center are existing in the country like cheap labor, skilled labor, infrastructure facilities and cost. So India lost the chance which was occupied by China. With a complex tax regime global products when launched from India as a manufacturing hub loses its competitive value being costlier than those imported from countries like China, Taiwan and South Korea. The analyzed lacunas have made India becoming a 'consumer state' rather than a production house. [ABSTRACT FROM AUTHOR]

Large inflows of foreign money into a country can appreciate its domestic currency, which can adversely affect its current account balance. South Asian countries receive a significant amount of foreign currency as remittances. In this paper, we examine the Dutch disease effect of remittances in five South Asian countries, namely Bangladesh, India, Nepal, Pakistan and Sri Lanka using panel data from 1975 to 2014. Panel cointegration test provides evidence of the long-run relationship between remittances and the real exchange rate. The Fully Modified Ordinary Least Squares Method (FMOLS) is used to estimate the impact of remittances on real exchange rates. The findings suggest that remittances do appreciate the real exchange rate in South Asia. Pesaran, Shin, and Smith ([1999]. Pooled Mean Group Estimation of Dynamic Heterogeneous Panels. Journal of the American Statistical Association, 94, 621–634) Pool Mean Group (PMG) estimation technique is used to check the robustness of the findings. The PMG test results confirm the findings from the FMOLS. [ABSTRACT FROM AUTHOR]

This study employs a system estimator to examine the validity of balance of payment constrained growth model in the case of Nigeria. We modified a version of Thirlwall's model developed by Soukiazis et al. (2014) to incorporate the role of foreign contents in growth process. The new version of the model improves significantly explaining the growth in Nigeria. The outcome of this study shows that imported intermediate and capital goods significantly contribute to manufacturing export and domestic investment growth. However, high reliance on the imports of intermediate goods constrains economic growth. World real income exerts significant effect on aggregate exports, similar arguments could not be established when the manufacturing export sector is considered in isolation. Our results reveal that economic growth in Nigeria is constrained by internal and external imbalances. The study recommends among others increasing the manufactured export share, efficient use of oil rents as well as containing budget deficit within acceptable threshold to position the economy on a viable growth path. [ABSTRACT FROM AUTHOR]

Until 1750 India was a thriving industrial manufacturing economy, producing 25% of the world's industrial output. From 2002 to 2012 Indian economy has run a trade deficit every year. It has the largest trade deficit with China which is $31 Billion. China is not amongst the top investing countries in FDI. There are certain forces which accelerate global manufacturing. These are huge factor cost differences, high growth in emerging markets and low transaction cost. India provides excellent opportunities for a global or multinational competitor to operate internationally from this country. Surprisingly China's bilateral trade with India grew from $0.2 Billion in 1990 to $13.6 Billion in 2004, without much progress in India's bilateral trade. Despite have a strategic location for sustaining global operations and quality logistics management, it failed. The essential factors which contribute to a decision of a firm to develop its operations considering India as an industrial center are existing in the country like cheap labor, skilled labor, infrastructure facilities and cost. So India lost the chance which was occupied by China. With a complex tax regime global products when launched from India as a manufacturing hub loses its competitive value being costlier than those imported from countries like China, Taiwan and South Korea. The analyzed lacunas have made India becoming a 'consumer state' rather than a production house. [ABSTRACT FROM AUTHOR]

This study empirically analyzes the direct impacts derived from the swift increase in exports to China (referred to as “the impact of China”) on the economic growth of three selected South American countries, Brazil, Chile, and Peru, during the commodity boom between 2001 and 2008. The results stemming from the balance-of-payments-constrained growth model suggest that the magnitude of China’s impact was less than 1 percent, although it ranged from the largest to the second largest impact among all trading partners for the three countries. The estimated balance-of-payments growth rate of domestic income is lower than the real growth rate of domestic income. This is because the growth rates of the export volumes were not sufficient even during the commodity boom, on account of the continued increasing trends of income elasticity of demand for imports. Furthermore, the income elasticities of demand for imports from China were especially high. Therefore, the three countries will continue to face further increase in the income elasticity of demand for imports as well as a stagnant growth rate of export volumes. Thus, the balance-of-payments position will continue to be the main growth constraint for these countries. [ABSTRACT FROM AUTHOR]

From the 1970s, the global currency system has two features: the use of one or a few sovereign currencies as the global reserve asset and the floating exchange rate regime between major currencies. This paper points out that the costs of the dollar's use as an international reserve currency exceed the benefits for both the US and the rest of the world. These costs include the exporting of American manufacturing as a byproduct of its current account deficit needed to supply its currency to the rest of the world. In addition to the detriment to trade from unpredictable exchange rate fluctuations, the termination of the U.S. obligation to redeem its currency for gold also removed an important restraint on deficit financing for the US and many other countries in the short-run, thus promoting excessive leverage that was a major contributor to the 2008 financial crisis. The paper suggests replacing several main countries' currencies in international reserves with a real Special Drawing Right (SDR) issued according to currency board rules. [ABSTRACT FROM AUTHOR]

This paper seeks to present a proposal of reform of the TARGET2 (Trans-European Automated Real-Time Gross Settlement Express Transfer) system aimed to correct intra-European Union (EU) financial, trade, and productive imbalances. For this purpose, the proposal relies on the application of the Keynes Plan’s principles to a regional integration process. Previously, the origins of the EU imbalances are traced to the shortcomings of the European monetary integration. Finally, the reforms needed to make the TARGET2 a rebalancing system are discussed in depth.JEL Classification: F32, F33, F36 [ABSTRACT FROM AUTHOR]

Copyright of Interventions Économiques is the property of Association d'Economie Politique and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

Copyright of Revista de la Historia de la Economía y de la Empresa is the property of BBVA Historical Archive and its content may not be copied or emailed to multiple sites or posted to a listserv without the copyright holder's express written permission. However, users may print, download, or email articles for individual use. This abstract may be abridged. No warranty is given about the accuracy of the copy. Users should refer to the original published version of the material for the full abstract. (Copyright applies to all Abstracts.)

The new manuals of the National Accounts and of the Balance of Payments are implementing new features regarding services. The paper points out the emergence of an innovative concept of services which is highly relevant but whose consequences may not be fully understood. This new perspective helps to focus on the true nature of services, but it also redefines the borders between services and goods. The paper addresses the problems left unresolved, or brought in, by the revisions. Furthermore, it studies the treatment of non-financial services in the BOP as compared to the SNA. Although the two approaches have been rendered more compatible, the BOP still incorporates several inconsistencies. The hesitancy to completely implement the new services definition tends to somewhat blur the measurement of trade in services. [ABSTRACT FROM AUTHOR]