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Intertemporal Choice, the Public Sector and Canada's Balance of Payments

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Author Info
Gordon R. Sparks

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Abstract

This paper analyzes the relationship between the current account deficit in Canada and the public sector deficit. The hypothesis that the public sector deficit is a major determinant of the current account deficit in the U.K. has become known as the New Cambridge approach to the balance of payments. A Fisherian model of intertemporal choice with a detailed public sector is used. We consider the extent public spending is viewed as a direct substitute for private consumption or capital accumulation.

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Publisher Info
Paper provided by Queen's University, Department of Economics in its series Working Papers with number 429.

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Length: 16
Date of creation: 1981
Date of revision:
Handle: RePEc:qed:wpaper:429

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