Current Account, Capital and Financial Account

What this note covers

1. The Balance of Payments: Structure and Purpose
2. The Current Account and Its Four Components
3. The Capital and Financial Account: Components and Significance
4. How a Current Account Deficit Arises
5. How the Current Account Deficit Is Financed
6. The Net International Investment Position and the Debt Trap
7. Policy Debates and Contemporary Context

7 sections · 14 key terms & formulas · 6 common mistakes