Abstract
Attributing the foreign trade effects of an expansion in the state budget to a single cause cannot do justice to the multitude of macro-economic interrelationships. Both theory and observation can reveal quite differing links between the public sector financial balance, the balance of payments and the exchange rate. The financing and nature of additional budgetary expenditure and the pattern of private investors’ expectations therefore have to be taken into consideration to obtain a clear picture of the possible consequences of budgetary expansion.
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References
Cf. OECD: Economic Outlook, 1977. Adiscussion of this theme is to be found in H. Lehment: Internationale Aspekte der Staatsverschuldung, in: Beihefte der Konjunkturpolitik, No. 27, 1980, pp. 61 ff.
Cf. E.-M. Lipp: Steigende Staatsverschuldung in offener Wirtschaft, in: Staatsfinanzierung im Wandel, Berlin 1983, p. 402.
Cf. R. Ohr: Staatsverschuldung und Liberalisierung der Weltwirtschaft, in: Sparkasse, Vol. 101, 1984, pp. 441 f; G. Dieckheuer: Budgetdefizit, Wachstum und Inflation, in: Zeitschrift für die gesamte Staatswissenschaft, 1983, pp. 80 ff.
Cf. E. Neuthinger: Bestimmungsgründe und gesamtwirtschaftliche Auswirkungen der staatlichen Kreditfinanzierung in der Bundesrepublik Deutschland seit 1974/75, in: IFO-Studien, Vol. 26, 1980, pp. 259 f.
On the development of the private sector’s financial balance in the Federal Republic of Germany, see E. Neuthinger, op. cit. Cf. E. Neuthinger: Bestimmungsgründe und gesamtwirtschaftiliche Auswirkungen der staatlichen Kreditfinanzierung in der Bundesrepublik Deutschland seit 1974/75, in: IFO-Studien, Vol. 26, 1980, pp. 259 f.
Cf. W. M. Corden: Protection, the exchange rate, and macroeconomic policy, in: Finance & Development, Vol. 22, No. 2, 1985, p. 17.
For example, this was true of the Federal Republic of Germany until the end of the seventies. Cf. R. Lenk: Konjunkturelle Wirkungen der Staatsverschuldung, in: IFO-Studien, Vol. 26, 1980, pp. 224 ff.
Cf. inter alia E.-M. Lipp, op. cit., Steigende Staatsverschuldung in offener Wirtschaft, in: Staatsfinanzierung im Wandel, Berlin 1983, pp. 406 f.
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Ohr, R. Expansion of the public sector, the current account and the exchange rate. Intereconomics 20, 296–300 (1985). https://doi.org/10.1007/BF02925471
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DOI: https://doi.org/10.1007/BF02925471