Glossary

Balance of payments (BoP) — A complete record of transactions between a country's residents and the rest of the world, comprising the current, capital, and financial accounts.^[1]

Current account — Trade in goods and services, plus primary income (investment income, compensation) and secondary income (transfers).

Financial account — Net cross-border acquisition of financial assets and incurrence of liabilities (direct, portfolio, other investment, reserves).

Capital account — Capital transfers and the acquisition/disposal of non-produced, non-financial assets (small for most economies).

International Investment Position (IIP) — The stock of a country's external financial assets and liabilities; the net IIP is assets minus liabilities.^[2]

Net errors & omissions — The residual that makes the accounts balance, reflecting measurement gaps.

Terms of trade — The ratio of export prices to import prices; the Prebisch–Singer hypothesis holds that it trends against primary-commodity exporters.^[3][4]

Unequal exchange — The systematic transfer of value through trade when exchange rates deviate from purchasing-power parity; Lewis uses Köhler's monetary measure.^[5]

World-system class — A classification of economies into core, semi-periphery, and periphery by income level and structural position.

BPM6 — The IMF's sixth edition Balance of Payments and International Investment Position Manual, the current international standard.^[1]

1. International Monetary Fund (2009). Balance of Payments and International Investment Position Manual (BPM6). IMF. link.
2. U.S. Bureau of Economic Analysis (2025). International Investment Position. BEA. link.
3. Raúl Prebisch (1950). The Economic Development of Latin America and Its Principal Problems. UN ECLA.
4. Hans Singer (1950). The Distribution of Gains between Investing and Borrowing Countries. American Economic Review.
5. Gernot Köhler (2003). The Structure of Global Money and World Tables of Unequal Exchange. Journal of World-Systems Research.