Growing government budget surpluses combined with growing trade deficits have generated record private sector deficits. Unless households continue to reduce their saving--creating an increasingly unsustainable debt burden--the impetus that has driven the expansion will evaporate.

According to Godley, the significance of the deficit in the U.S. balance of payments has been underestimated in both public policy and academic discussions despite the fact that U.S. markets are increasingly dominated by foreign manufacturers and the main cause of the 20-year deterioration in...

The following paper presents a series of two-country models, each of which makes up a whole world. The models are all based on a rigorous and watertight system of stock and flow accounts and can be used to generate numerical simulations of the way in which of the whole system evolves through...

This paper presents a simple growth model grounded in a stock-flow monetary accounting framework. The framework ensures that all stocks and all flows are accounted for and that the real and financial sides of the economy are coherent with one another. Credit, money, equities and stocks of real...

This paper formally integrates the theory of money and credit derived ultimately from Wicksell into the Keynesian theory of income determination, with assets allocated according to Tobinesque principles. The model deployed has much in common with the modern "endogenous money" school initiated by...