ECON 314 Chapter Notes - Chapter 13: Capital Outflow, Capital Account, Developing Country
Document Summary
Chapter 13 balance of payments, debt, financial crises, and stabilization policies: how debt would be implemented in the economy, how external debt has an effect on developing countries" economies. The balance of payments account: bofp summary of a nations and its residents financial transactions with the rest of the world. Comprised of: current account focuses on export and import of goods and services, investment income, debt service payments and private and public new remittances and transfers flow of funds that go to the country and outside the country. Bop deficit refers to current account - financial account and its impact on official reserves. Look at value of actual capital goods: official reserve transactions by the central bank (cash account) including foreign hard currency, gold, deposits with the imf. A schematic balance of payments account: net remittances: transfers that came into the countries from various purposes and what came out of the countries.