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What are the social and economic costs of External Stability? (1 Viewer)

mmmmmmmmaaaaaaa

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You should be able to gather some benefits/costs through your notes on the measurements (ie. cad as a % of GDP, etc)

But some include:
- External stability may be viewed as sustainable only if the investment (foreign) is being used to increase the productive capacity of the economy
- As Australia generally has a narrow export base (concentrated on commodities such as iron ore), a decrease in the export price index (and therefore a worsened tot level) will be bad for Australia's external sustainability
- You can do about how an extended period of a current account deficit can lead to a cycle of debt (not good for a country's external stability)
- larger a country's foreign liabilities (currently with Australia it is around 40%), worsened external stability

let me know if you need more help
 

ssoans

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You should be able to gather some benefits/costs through your notes on the measurements (ie. cad as a % of GDP, etc)

But some include:
- External stability may be viewed as sustainable only if the investment (foreign) is being used to increase the productive capacity of the economy
- As Australia generally has a narrow export base (concentrated on commodities such as iron ore), a decrease in the export price index (and therefore a worsened tot level) will be bad for Australia's external sustainability
- You can do about how an extended period of a current account deficit can lead to a cycle of debt (not good for a country's external stability)
- larger a country's foreign liabilities (currently with Australia it is around 40%), worsened external stability

let me know if you need more help

tysm! this is great

i just didnt find much on social costs other than decreased SOL after more money goes towards debt
 
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