How Do IMF Economists Justify This?

Chris Burford cburford at gn.apc.org
Sun Dec 30 12:35:24 PST 2001


At 29/12/01 15:43 -0800, you wrote:
>IMF encourages debtor countries to decrease imports
>and increase exports (devalue currency, produce for
>export, etc). This might work in an individual case,
>but it would seem to be stupid when prescribed
>globally (who is going to import???) What would an
>IMF economist reply to such a criticism?
>
>Thomas

Naive questions from intelligent people who are not afraid to pose naive questions, are sometimes the best.

Who is going to import???

Answer: the USA, as the "consumer of last resort"

Through its trade deficit it is kindly consuming the products of labour of the rest of the world. Indeed the only anxiety is that the USA may not be the consumer of last resort at the moment, but everyone is hoping that is will resume its duty of consuming the surplus of the rest of the world as soon as possible, otherwise what would happen to the global circulation of goods and services?

Chris Burford

London



More information about the lbo-talk mailing list