CONCEPTUAL APPROACH TO RECONCILIATION OF THE CONTROVERSIAL LINKS BETWEEN INTERNATIONAL ACCOUNTS

Abstract

The purpose of this paper is to analyze the controversial interaction between
such components of international accounts as current account and financial account
balances; to develop conceptual approach to reconcile those controversial links;
and to express some thoughts as to how this approach can be used in practice.
Keywords: current account balance, financial account balance, international
investment position, debt-cycle hypothesis, international capital flows, balance of
payments pressures.