Balance-constrained growth rates: generalizing Thirlwall’s law
In this paper, we show how the concept of balance of payments-constrained growth rate developed by Thirlwall (1979) can be generalized as the growth rate constrained by the balance between any two economic variables. In particular, we derive two new concepts: the government balance-constrained growth rate, and the private balanceconstrained growth rate. Some extensions of the basic model are also provided.
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