The paper presents an open-economy macrodynamical growth model with the aim of giving an endogenous characterisation to the process that leads a small country with a currency-board arrangement to accumulate dangerously high levels of external debt and become vulnerable to macroeconomic...

This paper proposes a theoretical two-sectors growth model for an economy in transition. The model stresses that long term output and employment dynamics as well as the actual transition pace are affected by demand-side factors and their interaction with supply-side factors. It derives a set of...