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The Balance of Payments and International Economic Linkages
The Balance of Payments and International Economic Linkages
Chapter 4
CHAPTER OVERVIEW
I. BALANCE-OF-PAYMENT CATEGORIES II. THE INTERNATIONAL FLOW OF GOODS, SERVICES, AND CAPITAL III. COPING WITH CURRENT ACCOUNT DEFICITS
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BALANCE-OF-PAYMENT CATEGORIES
A. THE BALANCE OF PAYMENTS (B-O-P) 1. PURPOSE: Measures all financial and economic transactions over a specified period of time.
PART I.
BALANCE-OF-PAYMENT CATEGORIES
2. Double-entry bookkeeping a. Currency inflows = credits (earn foreign exchange) b. Currency outflows = debits (expend foreign exchange)
BALANCE-OF-PAYMENT CATEGORIES
3. Three Major Accounts: a. Current b. Capital c. Official Reserves Current Account records net flow of goods, services, and unilateral transfers.
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4.
BALANCE-OF-PAYMENT CATEGORIES
5. Capital Account a. Function: records public and private investment and lending. b. Inflows = credits c. Outflows = debits d. Transactions classified as 1.) portfolio 2.) direct 3.) short term
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BALANCE-OF-PAYMENT CATEGORIES
6. Official Reserves Account a. Function: 1.) measures changes in international reserves owned by central banks. 2.) reflects surplus/deficit of a.) current account b.) capital account
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BALANCE-OF-PAYMENT CATEGORIES
b. Reserves consist of 1.) gold 2.) convertible securities 7. Net Effects: a. Sum of all transactions must be zero: 1.) current account 2.) capital account 3.) official reserves
BALANCE-OF-PAYMENT CATEGORIES
8. Balance-of-payment Measures a. Definitions: 1.) Basic Balance a.) consists of current account and long-term capital flows. b.) emphasizes long-term trends. c.) excludes short-term capital flows that heavily depend on temporary factors.
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BALANCE-OF-PAYMENT CATEGORIES
2.) Official Reserve Transactions Balance
- measures adjustments needed by official reserves.
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T.C. BOP
ODEMELER DENGESI (milyon ABD dolari) Ocak-Temmuz 2004
Carl Ilemler Dengesi -10025
Dis Ticaret Dengesi Ihracat Ithalat Sermaye ve Finans Hesaplari Finans Hesabi (Resmi Rezerv hari) Resmi Rezervlerdeki Degisim
Kaynak: TCMB.
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PART II.
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c.
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e.
3.
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(4.6)
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2. CA Deficit means
the nation is not saving enough to finance (I) and the deficit.
3. CA Surplus means the nation is saving more than needed to finance its (I) and deficit.
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II.
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US BOP Data
http://www.bea.doc.gov/ briefrm/tables/ebr10.htm
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