Financing deficits in recession


  • Using budget deficit financing through external borrowing

Context

In the early 1980s many countries ran into serious balance of payments problems. Recession in the industrial countries reduced the export earnings of developing countries, while high real interest rates increased their debt service obligations. Some lenders, concerned about the ability of individual borrowers to surmount these difficulties and uncertain about world economic prospects, became less willing than they had been to increase their lending.


© 2021-2024 AskTheFox.org by Vacilando.org
Official presentation at encyclopedia.uia.org