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Balance of payments adjustment mechanism |
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Balance of payments adjustment mechanismAny process, especially any automatic one, by which a country with a payments imbalance moves toward balance of payments equilibrium. Under the gold standard, this was the specie flow mechanism.Similar MatchesAdjustment mechanismAdjustment mechanismThe theoretical process by which a market changes in disequilibrium moving toward equilibrium if the process is stable. See Walrasian and Marshallian adjustment. Trade adjustment assistanceTrade adjustment assistanceA program of adjustment assistance for workers and firms in industries that have suffered from competition with imports. In the U.S., TAA began with the Trade Act of 1974, and has been renewed and expanded since then, including as part of the NAFTA. Higher rate adjustmentHigher rate adjustmentAn income tax coding allocated to people who pay tax at the higher rate.For interest received from banks or dividends from shares etc, the higher rate adjustment enables the Inland Revenue to collect the additional tax due over and above the basic rate. Marshallian adjustmentMarshallian adjustmentA market adjustment mechanism in which quantity rises when demand price exceeds supply price and falls when supply price exceeds demand price. International adjustment processInternational adjustment process1. Any mechanism for change in international markets. 2. The mechanism by which payments imbalances diminish under pegged exchange rates and nonsterilization. Similar to the specie flow mechanism, exchange-market intervention causes money supplies of surplus countries to expand and vice versa, leading to price and interest rate changes that correct the current and capital account imbalances. Further SuggestionsAdjustment bondWalrasian adjustment Border tax adjustment Adjustment date Structural adjustment Cumulative Translation Adjustment (CTA) account Adjustment assistance Structural adjustment program |
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