IDEAS home Printed from https://ideas.repec.org/a/mes/postke/v33y2010i1p169-204.html
   My bibliography  Save this article

Structural change, balance-of-payments constraint, and economic growth: evidence from the multisectoral Thirlwall's law

Author

Listed:
  • Raphael Rocha Gouvea
  • Gilberto Tadeu Lima

Abstract

This paper contributes to the literature on balance-of-paymentsconstrained growth by investigating how structural change, identified with changes in the sectoral composition of exports and imports, affects the external constraint. We test both the original and a multisectoral version of Thirlwall's law for a sample of Latin American and Asian countries. The original Thirlwall's law is found to hold for all sample countries except South Korea, whereas the multisectoral analogue holds for all of them. As the sectoral composition of exports and imports is found to matter for growth, we analyze the evolution of each country's weighted trade income elasticities.

Suggested Citation

  • Raphael Rocha Gouvea & Gilberto Tadeu Lima, 2010. "Structural change, balance-of-payments constraint, and economic growth: evidence from the multisectoral Thirlwall's law," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 33(1), pages 169-204, October.
    • Handle: RePEc:mes:postke:v:33:y:2010:i:1:p:169-204
    as

    Download full text from publisher

    File URL: http://mesharpe.metapress.com/link.asp?target=contribution&id=UG65161026807558
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Lima, Gilberto Tadeu & Carvalho, Veridiana Ramos da Silva, 2009. "Estrutura produtiva, restrição externa e crescimento econômico: a experiência brasileira," Revista Economia e Sociedade, Instituto de Economia, Universidade Estadual de Campinas (UNICAMP), vol. 36, pages 1-30, April.
    2. Juan Carlos Moreno-Brid, 1998. "On Capital Flows and The Balance-of-Payments-Constrained Growth Model," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 21(2), pages 283-298, December.
    3. Thirlwall, Anthony P & Hussain, Mohammed Nureldin, 1982. "The Balance of Payments Constraint, Capital Flows and Growth Rate Differences between Developing Countries," Oxford Economic Papers, Oxford University Press, vol. 34(3), pages 498-510, November.
    4. Anthony P. Thirlwall, 2011. "The Balance of Payments Constraint as an Explanation of International Growth Rate Differences," PSL Quarterly Review, Economia civile, vol. 64(259), pages 429-438.
    5. Jonathan Perraton, 2003. "Balance of Payments Constrained Growth and Developing Countries: An examination of Thirlwall's hypothesis," International Review of Applied Economics, Taylor & Francis Journals, vol. 17(1), pages 1-22.
    6. Ricardo Azevedo Araujo & Gilberto Tadeu Lima, 2007. "A structural economic dynamics approach to balance-of-payments-constrained growth," Cambridge Journal of Economics, Oxford University Press, vol. 31(5), pages 755-774, September.
    7. Luis Bértola & Hermes Higachi & Gabriel Porcile, 2002. "Balance-of-payments-constrained growth in Brazil: a test of Thirlwall's Law, 1890-1973," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 25(1), pages 123-140.
    8. A. P. Thirlwall, 1997. "Reflections on the Concept of Balance-Of-Payments–Constrained Growth," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 19(3), pages 377-385, March.
    9. Nelson H. Barbosa-Filho, 2001. "The balance-of-payments constraint:from balanced trade to sustainable debt," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 54(219), pages 381-400.
    10. Mario Cimoli & Gabriel Porcile & Sebastián Rovira, 2010. "Structural change and the BOP-constraint: why did Latin America fail to converge?," Cambridge Journal of Economics, Oxford University Press, vol. 34(2), pages 389-411, March.
    11. M. Ansari & N. Hashemzadeh & Y. Xi, 2000. "The Chronicle of Economic Growth in Southeast Asian Countries: Does Thirlwall’s Law Provide an Adequate Explanation?," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 22(4), pages 573-588, July.
    12. Juan Carlos Moreno-Brid, 1999. "On Capital Flows and the Balance-of-Payments-Constrained Growth Model," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 21(2), pages 283-298, January.
    13. Setterfield, Mark, 1997. "'History versus Equilibrium' and the Theory of Economic Growth," Cambridge Journal of Economics, Oxford University Press, vol. 21(3), pages 365-378, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anthony P. Thirlwall, 2011. "Balance of payments constrained growth models: history and overview," PSL Quarterly Review, Economia civile, vol. 64(259), pages 307-351.
    2. Raphael Rocha Gouvêa & Gilberto Tadeu Lima, 2013. "Balance-of-payments-constrained growth in a multisectoral framework: A panel data investigation," Journal of Economic Studies, Emerald Group Publishing, vol. 40(2), pages 240-254, May.
    3. Gustavo Britto & João Prates Romero, 2011. "Modelos kaldorianos de crescimento e suas extensões contemporâneas," Textos para Discussão Cedeplar-UFMG 449, Cedeplar, Universidade Federal de Minas Gerais, revised Jul 2013.
    4. A. P. Thirlwall, 2013. "Economic Growth in an Open Developing Economy," Books, Edward Elgar Publishing, number 15208.
    5. Yohanna Panshak & Irfan Civcir & Hüseyin Ozdeser, 2019. "Technology Gap and the Role of National Innovation System in a Balance of Payments Constrained Growth Model: Empirical Evidence From Nigeria," SAGE Open, , vol. 9(1), pages 21582440198, February.
    6. Ahmad Jafari Samimi & Ramezan Hosseinzadeh, 2011. "Foreign Trade and Economic Growth: Evidence of Thirlwall’s Law in Iran," Journal of Social and Development Sciences, AMH International, vol. 2(2), pages 81-88.
    7. Ricardo Azevedo Araujo & Gilberto Tadeu Lima, 2007. "A structural economic dynamics approach to balance-of-payments-constrained growth," Cambridge Journal of Economics, Oxford University Press, vol. 31(5), pages 755-774, September.
    8. Robert A. Blecker, 2009. "Long-Run Growth in Open Economies: Export-Led Cumulative Causation or a Balance-of-Payments Constraint?," Working Papers 2009-23, American University, Department of Economics.
    9. Araujo, Ricardo Azevedo, 2013. "Cumulative causation in a structural economic dynamic approach to economic growth and uneven development," Structural Change and Economic Dynamics, Elsevier, vol. 24(C), pages 130-140.
    10. Elias Soukiazis & Eva Muchova, 2012. "Slovak economic growth and the consistency of the balance-of-payments constraint approach," GEMF Working Papers 2012-16, GEMF, Faculty of Economics, University of Coimbra.
    11. Hiroshi Nishi, 2019. "Balance‐of‐payments‐constrained cyclical growth with distributive class conflicts and productivity dynamics," Metroeconomica, Wiley Blackwell, vol. 70(4), pages 620-640, November.
    12. Penelope Pacheco-Lopez & A.P. Thirlwall, 2005. "Trade Liberalisation, the Balance of Payments and Growth in Latin America," Studies in Economics 0506, School of Economics, University of Kent.
    13. Elias Soukiazis & Pedro Cerqueira & Micaela Antunes, 2011. "Growth rates constrained by internal and external imbalances: a demand orientated approach," GEMF Working Papers 2011-12, GEMF, Faculty of Economics, University of Coimbra.
    14. Elias Soukiazis & Pedro Cerqueira & Micaela Antunes, 2013. "Growth rates constrained by internal and external imbalances and the role of relative prices: empirical evidence from Portugal," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 36(2), pages 275-298.
    15. Elias Soukiazis & Pedro Cerqueira & Micaela Antunes, 2012. "Causes of the Decline of Economic Growth in Italy and the Responsibility of EURO. A Balance-of-Payments Approach," GEMF Working Papers 2012-03, GEMF, Faculty of Economics, University of Coimbra.
    16. Marwil J. Dávila-Fernández & José L. Oreiro & Mario W. D. Dávila, 2018. "Endogenizing Non-Price Competitiveness In A Model With Capital Accumulation And Bopc On Growth," Anais do XLIV Encontro Nacional de Economia [Proceedings of the 44th Brazilian Economics Meeting] 83, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics].
    17. Dávila-Fernández, Marwil J. & Oreiro, José L. & Dávila Dávila, Mario W., 2018. "Endogenizing non-price competitiveness in a BoPC growth model with capital accumulation," Structural Change and Economic Dynamics, Elsevier, vol. 44(C), pages 77-87.
    18. 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.
    19. Arslan Razmi, 2005. "Balance-of-payments-constrained growth model: the case of India," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 27(4), pages 655-687.
    20. Leon Podkaminer, 2017. "“Thirlwall’s Law” reconsidered," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 44(1), pages 29-57, February.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mes:postke:v:33:y:2010:i:1:p:169-204. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Chris Longhurst). General contact details of provider: http://www.tandfonline.com/MPKE20 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.