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In the medium- and long-run, prices rather than interest rates are thought to have an effect on exchange rates, and the purchasing power parity (PPP) theory, which posits as a determining factor in exchange rates, has been used not only in academic fields but also in practice. This study considers that exchange rates are determined by the mixture of past exchange rates and the PPP theory. On the other hand, it is often pointed out that the actual exchange rate diverges significantly from the exchange rate derived from the PPP theory. Moreover, this study hypothesizes that when the deviation becomes large, there will be a movement to correct the deviation. The empirical estimations show that when the deviation is large, such movement cannot be found and when the deviation is small, there is a movement toward correction. [ABSTRACT FROM AUTHOR]

The study investigated the relationship between sub national public debt and economic growth in Nigeria from 1981-2019. This study adopted the endogenous growth theory as the theoretical framework guiding the study. An OLS multiple regression model was used. All variables were found to be normally distributed and free from autocorrelation, heteroskedasticity as well as multicollinearity. The study provided evidence of a positive relationship but not significant between sub national public debt and economic growth in Nigeria. Population growth and sub national capital expenditure also has a positive relationship but not significant relationships with economic growth. Sub national government budget deficit have a negative impact on economic growth although not significant. When the exchange rate was introduced a moderating variable in the model there was a negative relationship between sub national public debt and economic growths. This means that foreign exchange rate is important in determining the direction of sub national public debt in Nigeria. The study recommends that state governments should direct borrowings to capital projects which will improve the growth through employment and income generation. [ABSTRACT FROM AUTHOR]

Copyright of Acta Economica is the property of University of Banja Luka, Faculty of Economics 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 Crónica Tributaria is the property of Instituto de Estudios Fiscales, Ministerio de Hacienda y Funcion Publica 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.)

This paper presents the economic effects of migration in North Macedonia. Remittances of immigrants for small countries with disabilities of economic competitiveness and with a significant balance of payments deficit such as North Macedonia are of particular importance. They enable foreign exchange reserves to remain at optimum levels, maintain a stable level of the national currency exchange rate and intensify economic development. The main objective is to highlight the importance of remittances in the economic development of North Macedonia and to suggest a more stimulating policy to encourage migrants to invest in their home country. Direct and indirect remittances account for about 20% of GDP in the economy of North Macedonia Such a level of remittances in which over 80% are of Albanian ethnicity indicates the contribution of this ethnicity to the economy of North Macedonia. The paper presents the dynamics of remittances and GDP in the last decade Parabolic regression is used in econometric analyzes, defined on the basis of the frequency distribution diagram. The interdependence of remittances and economic development in North Macedonia is analyzed in the last decade 2008/18. At the same time, the interdependence of the same indicators for neighboring countries such as Albania and Kosovo are presented. The empirical analysis of the correlative relation between remittances and GDP, expressed through coefficients of coercion, alliance and correlation, indicates a genuine link between development rates and remittances of immigrants in North Macedonia and two other Albanian states. The coefficient of determination shows that remittances have impacted the economic development of North Macedonia, Albania and Kosovo in the last decade. [ABSTRACT FROM AUTHOR]

Copyright of Financing is the property of Financing 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 article explores the commercial and economic incentives behind the arms transfers to Ba'thist Iraq under the administration of U.S. President John F. Kennedy and how these incentives intersected with U.S. strategic goals. The Kennedy administration was satisfied in the seizure of power in Baghdad, Iraq by the Ba'th Party and affiliated nationalist army officers on February 8, 1963. The administration had established a sales force of civilians and active-duty military officers at the Pentagon who eagerly pursued foreign military equipment sales to offset the costs of military assistance programs in the face of an expanding U.S. balance of payments deficit. The pursuit of arms sales reinforced some visions of an effective Cold War strategy for Iraq but conflicted with others.

Copyright of Journal of Management & Economics Research is the property of Journal of Management & Economics Research 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 article focuses on the role of inter-temporal budget constraints in the United States. The article also provides implications of government budget constraint for the behavior of monetary and fiscal authorities. It is explained that inter-temporal balance of payments equilibrium requires that the current net stock of foreign assets equal the discounted present value of current and expected future current account deficits. The article creates a necessary and sufficient condition for intertemporal budget balance under the assumption that the expected real rate of interest is constant and it is then compared to other tests of present value relationships.

The article provides information on a paper that analyzes, from a monetary perspective, the Peruvian experience with floating exchange rates during the early 1950s. The article presents a short-run version of the monetary approach to exchange rate determination. The author examines the issue of the purchasing-power-parity (PPP) condition and the Peruvian experience. The article also provides a test of short-run monetary equation of exchange rate determination. Several equations are provided to help illustrate the study.

The article discusses the welfare economics of monetary transfers and reversed transfers in Europe. The Oil Producing and Exporting Countries increased the world price of oil in 1973-74 which has created transfer problems that are of national and international concern. Transfer theory, where transfers are made in one period and reversed in the next, has aided in the question of how the welfare of a country is affected by the stabilization of exchange rate through foreign exchange reserves. In reversed transfer there is one country benefiting while the other looses.

In efficient financial markets, asset prices adjust instantaneously to reflect new information. Instantaneous adjustment eliminates the possibility of predicting future prices using only past prices. Hence, the possibility of earning systematic excess profits is also eliminated. In assessing the efficiency of markets, spectral analysis and quite similar forms of serial correlation tests have been extensively employed, and apparently "indisputable" judgments have been made concerning the efficiency of markets based upon these results. Unfortunately, spectral analysis and its close variants are not particularly powerful tests of market efficiency. As Smidt (1968) pointed out in a much more general context, tests of efficiency should be directed against specific alternative hypotheses. That is, there is no all purpose test of market efficiency, and as this note will later demonstrate, spectral analysis is far from the best even when contrasted with a set of extremely naive trading rules. We first examine the theoretical deficiencies of spectral analysis; then we apply this test and a simple alternative to the foreign exchange market for the French Franc and U.S. dollar. The spectral test shows that this market is quite efficient, yielding 'white noise' at the 95% level of confidence, however, a simple filter rule shows that substantial profits could have been made by a trader in this market, even after accounting for transactions costs. [ABSTRACT FROM AUTHOR]

The article analyzes the impact of government budget restraint on money and income. The author challenges the assumption that an increase in the money supply causes income to rise. The balance of payments statement of government, known as budget restraint, seeks to equate receipts and expenditures. Induced financing may be necessary to maintain the equality between receipts and expenditures and manipulate exogenous and endogenous policy variables. Econometric formulas demonstrating the relationships between government purchases and payments are examined.

This is a progress report. It introduces a new medium-sized model of the U.S. balance of payments and, to go with it, a macroeconomic model of the domestic economy. It goes on to illustrate uses of the model, including a simple demonstration of the case for making careful, correct assignments of policy instruments to policy targets. [ABSTRACT FROM AUTHOR]

Countertrade, offsets, barter, and buybacks have existed since before money was invented but over the last few centuries have been treated as marginal phenomena. However, current estimates of the volume of these activities range from 8 to 30 percent of world trade and could reach 50% by the year 2000. What is surprising is not just the imprecision of the data but the fact that we have no control over this enormous volume of international transactions. This article examines these forms of trade, their causes and policy implications, and their future impact on our open trade system. [ABSTRACT FROM AUTHOR]

The dramatic increase in the merchandise balance of trade deficit between the United States and its major competitors has prompted a call for policies designed to increase the international competitiveness of the American economy. Policies designed to promote the competitiveness of particular industries must be approached with caution. Unless they are based on a sound understanding of the sources of the economic benefits of trade, they are unlikely to accomplish their objectives. The real key to improving international competitiveness lies in better macroeconomic management of the nation's economy. [ABSTRACT FROM AUTHOR]

Cornell and Reinganum (1981), hereafter CR, report that price differentials for future contracts and forward contracts are statistically insignificant in foreign exchange markets. Based on this finding, CR conclude that marking-to-market is insignificant in the formulation of currency futures prices. This note identifies two potential concerns with the CR tests. One problem relates to the timing of delivery dates for "matched" contracts. A second problem relates to the time period for the CR study. We show that correcting for these problems does not affect the overall conclusions of the CR study; marking-to-market does not appear to have a significant effect on currency futures prices. [ABSTRACT FROM AUTHOR]

Recent empirical studies of the risk premium across foreign exchange and other asset markets such as equity and longer term bonds have found conflicting evidence about the latent variable model restrictions of the consumption-based intertemporal capital asset pricing model. While studies using data for holding periods of one month or less generally reject the model, evidence using three-month holding periods indicates that the model cannot be rejected when including the returns on long relative to short deposit rates. This paper investigates the sources of differences in results using returns on foreign exchange and Eurocurrency deposits at three different maturities. [ABSTRACT FROM AUTHOR]

This study is a research analysis of the persistent balance of payments problem of the U.S. Because the American companies are more competitive in the high technology industries, the computer manufacturing business is used as the vehicle for this research. [ABSTRACT FROM AUTHOR]

This article discusses the capability of the U.S. to correct its balance of payments deficit in order to protect the international monetary system in a time in which there are no international monetary reforms which will eliminate these problems. If the institution of the necessary monetary policy does not restore equilibrium before the country's supply of international reserves declines too low, international confidence in the dollar will be lost. During U.S. President John F. Kennedy's term, he appointed a three-man task force to work to restore this equilibrium.

The article focuses on monetary theory, money or gold reserves, and the appropriate distribution of international liquidity. A comparison of international and domestic liquidity shows the influence of foreign-exchange reserves, relationship between price levels and the supply of money or liquidity, and inflationary influences that can occur when there are balance-of-payment deficits in some countries and surpluses in others. An analogy is used to illustrate the difference between poverty of resources in international finance and a shortage of money in an individual family. Conditions where additional liquidity and new spending will bring inflation, the International Monetary Fund, and monetary expansion via the creation of domestic money are mentioned.

The article presents commentary on the report "Implications of Balance of Payments: Deficits for Bank Liquidity," by Howard E. Mitchell, included within the issue. The author's statements about trends in U.S. commercial bank liquidity are noted but also discussed within the context of the greater industrial and commercial environments of the U.S. economy in the 1950s and 60s, suggesting that adjustments are more universal than implied in the work.

The article present an exploration into the possible adverse effects of increased money supply and liquidity on commercial banking. The desire for maintaining money supply in response to balance of payment deficits within the U.S. economy in the 1960s is cited but several logistical problems within bank interest rate payments are also described. An overview of bank regulation within the previous decade of the 1950s is provided to describe the causes of such circumstances and alternative policy suggestions are offered.

According to the most common understanding, currency crises are always and everywhere a monetary phenomenon. Based on a formal theoretical model and ample empirical evidence, this article argues instead that currency crises are always and everywhere about external imbalances. They are usually preceded by booms in consumption, investment, and output. Since part of the added spending falls on imports, output and saving rise less than investment, pushing the current account into deficit. The exchange rate depends on the gap between cumulative capital inflows and the cumulative current account deficit. When the boom starts, this gap is positive and the central bank can hoard reserves and sterilize capital inflows. Yet later, as optimism fades, the gap inevitably turns negative, leading to the depletion of reserves and the collapse of the exchange rate. Panic can lead to precipitous speculative attacks. [ABSTRACT FROM AUTHOR]

This article classifies extreme net capital flow episodes into four types and analyzes the macroeconomic impacts of each type. First, we find that all types of episodes increased drastically in the 2000s relative to previous years. Second, we conclude that liability-flow-driven episodes have more significant macroeconomic impacts than do asset-flow-driven episodes. Third, we show that only drastic positive net capital flows that were driven by liability flows were associated with a higher probability of banking crises in the 2000s. The results suggest that the detailed classification of extreme net capital flows provides insight into these movements’ macroeconomic impacts and policy implementations. [ABSTRACT FROM PUBLISHER]

To correct the serious imbalances accumulated before the crisis .from 2010 to 2014 there were a number of tough but necessary reforms that have resulted in today's macroeconomic situation. The macroeconomic situation of the country is likely to weaken again because of legislative initiatives with electoral purposes that started in the middle of 2015. Enforcing them would pose a risk to financial stability or a danger to economic performance. One of the risks that could materialize in this case is the risk of the current account deficit. The evolution of the current account deficit, however, drew attention because of the level reached at the end of last year. The revised data of the National Bank of Romania show a deficit of 2.662 billion euros in the first nine months of 2016. National Commission for Prognosis (CNP) provides data on government bases its budget projections. For 2016 it is estimated a current account deficit of 3.75 billion euros, double the 2015 level. [ABSTRACT FROM AUTHOR]

FDI inflows are the necessity of Indian economy. This is because India is in the process of transformation from traditional economy to modern economy. FDI inflows play a crtical role in providing resources for accelerating the pace of growth of Indian economy. FDI further helps in keeping current account deficit at the low ebb. This paper tries to highlight the emerging trends in FDI inflows to Indian economy. FDI inflows are also coming through mergers and acquisitions. India is adequately attracting FDI inflows and hence has come out as the top destination in the world. [ABSTRACT FROM AUTHOR]

Are trade cost reductions a plausible explanation for growing global current account imbalances? I advocate that changes in trade costs affect trade and production structures, which is likely to affect national savings and investment. Explicitly adding trade costs à la Markusen and Venables into Jin's framework, this augmented model predicts that trade cost reductions affect the current account through changes in the industrial structure. Empirical evidence confirms that the interaction of trade costs and capital intensity drives current account balances. I also provide evidence that the response of current accounts to changes in trade costs depends on the capital intensity of production and on the depth of regional agreements on trade and factor mobility. Aside from the direct effect generally emphasised in standard macro-level analysis, changes in production patterns could therefore be an additional channel of impact of regional integration on current accounts. [ABSTRACT FROM AUTHOR]

Various international institutions such as the European Commission, the ECB and the OECD often use unit labour costs as a measure of international competitiveness. The goal of this paper was to examine how well this measure is related to international export performance at the firm level. To this end, we use Belgian firm-level data for the period 1999 to 2010 to analyse the impact of unit labour costs on exports. We find an estimated elasticity of the intensive margin of exports with respect to unit labour costs between −0.2 and −0.4. This elasticity varies between sectors and between firms, with more labour-intensive firms having a higher elasticity. The microdata also enable us to analyse the impact of unit labour costs on the extensive margin. Our results show that higher unit labour costs reduce the probability of starting to export for non-exporters and increase the probability of exporters stopping. While our results show that unit labour costs have an impact on the intensive margin and extensive margin of firm-level exports, the effect is rather low, suggesting that pass-through of costs into prices is limited. The latter is consistent with recent trade models emphasising that not only relative costs, but also demand factors such as quality and taste matter for explaining firm-level exports. [ABSTRACT FROM AUTHOR]

Current account ( CA) dispersion within European Union ( EU) Member States has been increasing progressively since the 1990s. Interestingly, the persistent deficits in many peripheral countries have not been accompanied by a significant growth process able to stimulate a log run rebalancing as neoclassical theory predicts. To shed light on the issue, this paper investigates the determinants of Eurozone CA imbalances, focusing on the role played by financial integration. The analysis considers two samples of 22 OECD and 15 EU countries, three time horizons corresponding to various steps in European integration, different control variables and several panel econometric methods. The results suggest that within the EU group of countries financial integration contributed to explain the CA deterioration in the peripheral countries especially in the post- EMU period creating an asymmetric behaviour within the EMU. From a financial stability perspective, this 'divergence' could hinder the effectiveness of monetary policy. By reducing the apparent benefits of participating in the monetary union, it also raises the risk of a break-up. [ABSTRACT FROM AUTHOR]

For a better understanding of the ongoing debates on the RMB, this paper investigates the effects of exchange rate shocks on output and the current account for China and Japan. We use structural vector auto-regression models and find that yen appreciation reduces current account surpluses while having no strong effect on output in Japan. RMB appreciation, on the other hand, has an insignificant effect on the current account, although it tends to reduce output in China. For China, dollar pricing with vertical trade integration seems responsible for the insignificant effect on the current account. [ABSTRACT FROM AUTHOR]

The article comments on a paper published within the issue, "The Balance of Payments Adjustment Process Revisited," by Helen B. Junz. The author focuses on the phenomenon of balance of payments adjustment when industrial countries face higher account deficits, rates of wage-price inflation, and levels of unemployment than they are unaccustomed to. The author notes that these difficulties are unevenly distributed among industrial countries, and have created doubt and confusion over the effectiveness of traditional economic policy instruments. The author believes that the major problems of balance of payments adjustment are soluble by a return to sensible domestic economic policies in Europe and Japan, where decisive fiscal and monetary policy action appear to be called for.