How to Solve the Trade Problem: The Generalized Buffett Countertrade Plan*
This article outlines a countertrade plan that would give countries another tool to control trade imbalances. It is a generalization of a plan put forward by Warren Buffett. It involves creating a new market in Countertrade Certificates in which exporters and importers would be required to offset the effect of their trade on the trade balance by buying an offsetting Countertrade Certificate. The price of these Certificates would depend on the degree of trade imbalance in their absence.
KeywordsGlobalization Trade policy Export-led growth Trade imbalance
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