According to economic theory,fast-growing countries should be running __________;but the evidence is that in fast-growing countries,__________.

Question

Quizplus · Accepted Answer

According to the causality from exports to growth theory, fast-growing countries tend to run trade deficits because as their exports increase, they need to import more capital goods and raw materials to sustain their growth. This is supported by empirical evidence that shows fast-growing countries like China, India, and Brazil have had persistent trade deficits in recent decades.

According to Economic Theory,fast-Growing Countries Should Be Running __________;But the Evidence