Nepal has been experiencing a continuous trade deficit over the
decades. For some economists, trade deficit, in itself, is not a
problem. They argue that when an economy makes a big investment or
when people consume more than they nationally produce, a trade
deficit takes place. However, a prolonged trade deficit in any
economy cannot be perceived as a healthy sign. An economy can
hardly sustain an unceasing trade deficit. This book has explored
the principal causes of trade deficit in Nepal which are likely to
be common in many countries. The author has been able to explore
the root causes without applying any sophisticated econometric
models. His findings are distinct in simple line graphs. The
research has been built above a sound theoretical foundation.
Undoubtedly, this book is successful in explaining why a trade
deficit is viewed as a problem against those who do not take it as
a serious phenomenon under given circumstances. Leaving enough
ground for econometricians, this book challenges the conventional
understandings regarding the general causes of trade deficit.
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