Inequalities in the Balance of Payments

The balance of payments inequalities of the US, its impact to the world-economy and potential solutions

Abstract
The overall purpose of the underlying paper is to discuss the balance of payments inequalities of the US and its impacts on the world economy. Due to Globalization and an increase of international transactions between countries the importance of the balance of payments increased as well. For a better understanding and handling with the very complex topic the author starts with an introduction and tries to define the term balance of payments. Moreover the structure of the balance of payments is clarified and that should help the reader to understand how a positive (surplus) or negative (deficit) in the balance of payments can evolve and how it can be corrected. The main reason for the previously mentioned inequalities of the United States balance of payments and its deficit is caused by higher imports than exports over the last decades. That balance of payments deficit in the largest economy all over the world can have huge impacts on trade and transactions between many countries and it may affect the whole world economy. The author tries to explain how that deficit might be decreased and what kind of possible approaches and solutions do exist to avoid a further economic crises influenced by a living on the nod in the United States.

Table of Contents

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Introduction ………………………………………………………… Inequalities in the balance of payments …………………..……. The United States as a Debtor Nation ………………………….. Possible approaches and solutions for the US…………………. US deficit and its impact on the world economy ………………. Conclusions ………………………………………………………...

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References ………………………………………………………………….

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1 Introduction
The importance of the developments in the balance of payments is continuously increasing for each country and economy during the last few decades due to Globalization, which is mainly influenced by technological... [continues]

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