Kuwait-University-Journal-of-Law-header
Search
Journal of Law

Previous Issues

Advance Search
Year : From To Vol
Issue Discipline:
Author

Volume :15 Issue : 4 1987      Add To Cart                                                                    Download

Excess Domestic Liquidity and Balance of Payments Deficit in Non-Oil Developing Countries: 1968-83

Auther : Fathi Kh. EL-Khadrawi

This paper contributes to the literature of the monetary approach to the balance of payments. It reports on the experience of non-oil developing countries, oil-exporting countries, and industrial countries for the period 1968  to  1983.

The fundamental conclusion of the monetary approach is that domestic money supply (demand) manifest itself in an external deficit (surplus). Because of the heavy reliance of non-oil developing countries on domestic credit (the domestic component of money supply), external imbalances of those counties are best explained by this approach. Hence, our hypothesis is that this approach is best suited to non-oil developing countries rather than oil-exporting or industrial countries.

After sketching the fundamentals of the monetary approach, and reviewing the experience of the three economic entities, a model is developed in the form of a single equation that relates current surplus (net export of goods and services) to both the domestic credit variable and money demand variable. The empirical investigation supports this hypothesis.

Journal of Law
Journal of Law

You are Visitor No.

76878

Journal of Law
Journal of Law
Tell your friendsJournal of Law
Journal of Law

Last Updated

May 16, 2017

Journal of Law
Journal of Law
Journal of Law

Please enter your email Here to receive our news

Journal of Law