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Balance Of Payments-Constrained Growth In Developing Countries: A Theoretical Perspective


  • Dillon Alleyne
  • Alfred A. Francis


The paper clarifies some issues raised in the basic model of balance of payments-constrained growth due to Thirlwall and later extensions by Thirlwall and Hussain and Moreno-Brid. The model is also adapted to include both interest payments and net transfers. The latter variable has become very important to many developing countries and brings a new dimension to the analysis. Very importantly, net transfers are positively related to foreign income and negatively related to domestic income. Thus, the paper accounts for dynamic feedback effects, between net transfers, domestic and world income. Copyright © 2008 The Authors.

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  • Dillon Alleyne & Alfred A. Francis, 2008. "Balance Of Payments-Constrained Growth In Developing Countries: A Theoretical Perspective," Metroeconomica, Wiley Blackwell, vol. 59(2), pages 189-202, May.
  • Handle: RePEc:bla:metroe:v:59:y:2008:i:2:p:189-202

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    References listed on IDEAS

    1. Georgios Bitros, 2005. "Some Novel Implications of Replacemnt and Scrapping," Macroeconomics 0504029, EconWPA.
    2. Fuss, Melvyn & McFadden, Daniel, 1978. "Production Economics: A Dual Approach to Theory and Applications (I): The Theory of Production," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, volume 1, number fuss1978.
    3. Morton I. Kamien & Nancy L. Schwartz, 1971. "Optimal Maintenance and Sale Age for a Machine Subject to Failure," Management Science, INFORMS, vol. 17(8), pages 495-504, April.
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    Cited by:

    1. -, 2012. "Structural change for equality: an integrated approach to development. Thirty-four session of ECLAC. Summary," Documentos de posición del período de sesiones de la Comisión 13535, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    2. Garcimartin, Carlos & Kvedaras, Virmantas & Rivas, Luis, 2016. "Business cycles in a balance-of-payments constrained growth framework," Economic Modelling, Elsevier, vol. 57(C), pages 120-132.
    3. Anthony P. Thirlwall, 2011. "Balance of payments constrained growth models: history and overview," PSL Quarterly Review, Economia civile, vol. 64(259), pages 307-351.
    4. -, 2012. "Structural change for equality: an integrated approach to development. Thirty-four session of ECLAC. Summary," Libros y Documentos Institucionales, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), number 13535 edited by Eclac, March.
    5. A. P. Thirlwall, 2013. "Economic Growth in an Open Developing Economy," Books, Edward Elgar Publishing, number 15208.
    6. repec:gei:jnlfer:v:2:y:2017:i:1:p:1-15 is not listed on IDEAS

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