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With regard to the effect of growth on the balance of payments of a country, the conclusion of the Keynesian theory of income determination sharply differs from that of the monetary theory. This article suggests an integrated approach towards the derivation of the import function and the balance of payments equation for a money‐using economy from the utility‐maximising behaviour of individuals. Thereby, it shows that the difference between the conclusions of the two theories results from an incorrect specification of the balance of payments equation in the Keynesian theory.

The equation of unified knowledge says that S = f (A,P) which means that the practical solution to a given problem is a function of the existing, empirical, actual realities and the future, potential, best possible conditions of general stable equilibrium which both pure and practical reason, exhaustive in the Kantian sense, show as being within the realm of potential realities beyond any doubt. The first classical revolution in economic thinking, included in factor “P” of the equation, conceived the economic and financial problems in terms of a model of ideal conditions of stable equilibrium but neglected the full consideration of the existing, actual conditions. That is the main reason why, in the end, it failed. The second modern revolution, included in factor “A” of the equation, conceived the economic and financial problems in terms of the existing, actual conditions, usually in disequilibrium or unstable equilibrium (in case of stagnation) and neglected the sense of right direction expressed in factor “P” or the realization of general, stable equilibrium. That is the main reason why the modern revolution failed in the past and is failing in front of our eyes in the present. The equation of unified knowledge, perceived as a sui generis synthesis between classical and modern thinking has been applied rigorously and systematically in writing the enclosed American‐British economic, monetary, financial and social stabilization plans. In the final analysis, a new economic philosophy, based on a synthesis between classical and modern thinking, called here the new economics of unified knowledge, is applied to solve the malaise of the twentieth century which resulted from a confusion between thinking in terms of stable equilibrium on the one hand and disequilibrium or unstable equilibrium on the other.

The main aims of this paper include a revision of the essentials of the monetary approach to the balance of payments by constructing a monetary model, an extension of the model to explain the importation of inflation in an open economy and an application of the formulated model to the two small open economies, the Netherlands and Singapore. The most important contribution of the monetary approach to the balance of payments is its focus on the role of money as opposed to the focus of traditional approaches on the real variables and on the current account of the balance of payments. Influenced originally by Johnson (1972), there have been several theoretical as well as empirical analyses supporting the major contentions of the monetary approach to the balance of payments. Notable among these are Mussa, Frenkel and Johnson (1975), Kemp (1975), Whitman (1975), and Kreinin and Officer (1978). On the basis of common elements enclosed in the writings of these authors, it is possible to construct such a model and then solve it, first, for foreign reserves inflow, and second, for the domestic inflation rate as a dependent variable. This formulation is similar to the ones found in Bhatia (1982) and Salvatore (1983), but is broader in its implications. A check of the validity of the relationships of the monetary model is also attempted by using the annual data of the Netherlands and Singapore.

Social scientists have increasingly turned to constructivist models to explain when, and how, international and world-level social forces constrain the policy-making autonomy of national states. While constructivists have shown that international ideational processes matter for domestic policy making, they have had a harder time explaining why some ideas gain prominence in policy discussions while others do not. This chapter develops an institutionally centered materialist model of idea selection, arguing that international relations of dependency give actors who control vital financial resources a greater capacity to shape the ideational agenda. This model is explored through a case study of the international sources of American monetary policy in the early 1960s. A detailed examination of archival materials shows that European officials at the Organization for Economic Cooperation and Development were able to advance their own ideas for American monetary policy because the United States was dependent on European cooperation to help resolve its mounting balance of payments problems.

This chapter starts from the issue of debt in the context of a national economy by contrasting two opposed views: policy prescriptions based on the Washington Consensus prioritize low public debt and a limited role of the government in the development process whereas a more heterodox view considers debt as logical, necessary, and helpful in order to allow the government to pursue an ambitious growth and development strategy. However, things change when the economy is considered in its international context: foreign debt is different from domestic debt and while the same heterodox analysis still rejects the Washington Consensus' demand for trade and financial liberalization, its own ambitious development strategies for the domestic economy get constrained by trade deficits, the threat of capital flight, and exchange rate instability. The question arises how the government can still significantly contribute to economic development beyond the limits of a purely private sector–driven approach. This is why this chapter reviews proposals to relax or overcome the balance-of-payments constraint. Finally, it considers a reform of international payments, which can be implemented by a single country unilaterally, and which enables it to stabilize its current account, avoid foreign debt accumulation, and support domestic development strategies.

The Equal Pay Act 1970 (which came into operation on 29 December 1975) provides for an “equality clause” to be written into all contracts of employment. S.1(2) (a) of the 1970 Act (which has been amended by the Sex Discrimination Act 1975) provides:

We develop the concept of the slave-trade balance of payments and generate its table for the United States for 1790–1860. In the process, we construct new data for the slave trade, including both the physical movement and revenue figures, and we analyze these numbers. The balance of payments includes slave imports, carrying trade in slaves, purchases of slaves that fail to be imported, outfitting and provisioning slave ships, and slave-ship sales. The slave-trade balance is integrated into the standard balance of payments. Among the findings are the following: slave imports were dominated by natural growth except for one decade; US ships had the greater role than foreign ships in the import trade, but were of small—and eventually nil—consequence in the carrying trade; federal and state laws to prohibit the slave trade in all its aspects were generally effective; and the slave-trade balance of payments was a small component of the overall balance.

Analyses how the status of balance of payments follows se\ill\ fulfilling expectations of currency devaluation. It is found that before a currency devaluation, whether the economy w\ill\ experience a balance‐of‐payments surplus or deficit crucial depends on the degree of capital mobility.

The purpose of this paper is to contribute to the literature on demand-driven Keynesian growth in open economies by developing a formal model that combines Dixon and Thirlwall’s (1975) export-led growth model and Thirlwall’s (1979) balance-of-payments constrained growth model into a more general specification. Then, based on the model developed in this paper, the authors analyse more broadly some important issues concerning the net impact of currency depreciation on the short-run growth.

The authors build upon Dixon and Thirlwall’s (1975) export-led growth model and Thirlwall’s (1979) balance-of-payments constrained growth model in order to develop the theoretical framework. The authors also run numerical simulations to illustrate the net impact of devaluation on the short-run growth rate in different scenarios.

The authors demonstrate that the net impact of currency devaluation on growth can go either way, depending on some structural conditions such as the average share of imported intermediate inputs in prime costs of domestic firms and the institutional capacity of trade unions to set nominal wages through the bargaining process. The model also shows that the effectiveness of a competitive real exchange rate to promote growth is higher in countries where the share of labour in domestic income is also higher.

This paper provides a coherent formal starting-point for further theoretical developments on the interrelatedness between currency devaluation, income distribution and growth. These findings provide empirically testable hypothesis for future research.

The present study proposes an alternative formal solution for the theoretical problem of imposing a balance-of-payments constraint on the process of cumulative causation often incorporated in Kaldorian growth models. In terms of policy, the framework sheds further light on the relevance of income distribution and the labour market institutional framework for the dynamics of the exchange rate pass-through mechanism and allows us to map out related conditions under which currency devaluation can promote growth.