Abstract
It is still uncertain whether the world economy can adjust to the sharp rise in oil prices without a major loss of output. It is, in other words, uncertain whether all the main aspects of the new situation are sufficiently understood. This chapter deals with four of these aspects: (i) the transfer mechanism, (ii) the nature of the payments problem, (iii) the implications for the oil-importing countries of the large external debt they will have to carry and (iv) their structural adjustment to the higher level of oil prices.1
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Notes and References
For example it is stated in Richard N. Cooper, “Liquidity and Payments Adjustment”, in International Reserves (Washington: International Monetary Fund, 1970) pp. 127–28, that “the rationale for reserves to finance imbalances arises from the real cost associated with adjustment or, when adjustment is unavoidable, from speedy adjustment”.
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© 1976 Trade Policy Research Centre
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Tumlir, J. (1976). Oil Payments and Oil Debt and the Problem of Adjustment. In: Rybczynski, T.M. (eds) The Economics of the Oil Crisis. Trade Policy Research Centre. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-02810-8_4
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DOI: https://doi.org/10.1007/978-1-349-02810-8_4
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-02812-2
Online ISBN: 978-1-349-02810-8
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