DT 07/21 - La restricción de balanza de Pagos en países especializados en commodities: Repensando el modelo de Thirlwall a la luz del último súper boom de precios.

In this article we develop a balance of payments constrained growth (BPCG) model, adapted to capture the specific conditions of small commodity-dependent countries. The argument is presented in light of historical experience, and especially, of the available evidence on the effects of the last commodities super cycle. We start from the classic Thirlwall (1979) model, but we modified it in key aspects. We assume exogenous export prices, infinite price elasticity of export demand, and supply of commodities that react to prices with positive, but not infinite, elasticity. This model contributes to analyze two aspects that are invisible in the BPCG models. These are: i) to identify and analytically explain the central role of export prices and ii) the relevance of price competitiveness (through exchange rate) in the growth dynamics of the countries. It is shown that a trajectory of real devaluation (exchange rate evolves above domestic costs) and an improvement in the terms of trade, in a context of increasing international prices, increase the equilibrium growth rate without ambiguity. However, it is concluded that export prices are more relevant than the terms of trade in determining the growth of these countries.