International Monetary Economics

The elasticity approach would be followed by the presentation of the traditional approach and the monetary approaches of balance of payments. Although there exist very literature to explain the differences between the traditional and the monetary approaches of balance of payments, the two views have been hypothetically compared by Whitman (1975). The study seeks to compare the three approaches and their impacts on the balance of payments of the country. This would be followed by a critical analysis through the presentation of a critical literature on the above aspects through which it tries to present the impacts of exchange rates adjustments on the balance of payments of nations.