352
MACROECONOMICS
To sum up, the three alternative ways in which the current account position
of a country may be written then are
C
1
pvt
+
G
+
C
2
pvt
+
G
______
1
+
r
=
(
Y
1
-
I
1
)
+
Y
2
____
1
+
r
(13.8)
TB
1
+
TB
2
____
1
+
r
=
0
(13.13)
CA
1
+
CA
2
=
0
(13.14)
A
qualification that must be borne in mind is that the analysis assumes
that a debtor country always honours its debts. In the international economy,
where enforcement of contracts is more difficult, debtors may sometimes
choose not to repay.
13.2
Current Account Determination
To understand this perspective of current ...
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