Drug Trade and Statistical Discrepancies in the U.S. Balance of Payments

Authors

  • Mehdi Hojjat Hojjat Neumann University

DOI:

https://doi.org/10.18533/ijbsr.v4i8.577

Keywords:

Balance of Payments, Drug Trade, Statistical Discrepancies, Balance of Payment Accounting

Abstract

This paper tests the hypothesis that residual values in balance of payment accounting are a random variable. Previous research in this area has been satisfied with an explanation that these residual values are just statistical discrepancies and are random in nature. This paper reveals a structural problem with the way balance of payment accounting has been set up and data are collected. The research proves that there is a positive bias about these values. Moreover, the research shows that there is a positive relationship between the size of the illicit drug market and the statistical discrepancies in the U.S. balance of payments.

References

U.S. Bureau of the Census (2014). Retrieved from http://www.census.gov/foreign-trade/statistics/historical/

Bureau of Economic Analysis (April 2011), Survey of Current Business, U.S. International Transactions. “In 2010, the statistical discrepancy was $235.1 billion, compared with $162.5 billion in 2009.”

Daniels, Joseph and VanHoose, Davis (1999), International Monetary and Financial Economics, South-Western, page 28.

United Nations Office on Drug and Crimes (2011), World Drugs Report. Retrieved from http://www.unodc.org/documents/data-and-analysis/WDR2011/World_Drug_Report_2011_ebook.pdf

Sakyi & Kwesi, A. (2013). “Money Laundering, Drug Trafficking, Corruption”, GhanaWeb, Retrieved from: http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=292926

Morphy, D. (2013) “Money Laundering and The Drug Trade: The Role of the Banks”, Center for Research for Globalization. Retrieved from: http://www.globalresearch.ca/money-laundering-and-the-drug-trade-the-role-of-the-banks/5334205

Mazur, Robert (Jan 2, 2013). “How to Halt Terrorism Money Train”. New York Times. Retrieved from: http://www.nytimes.com/2013/01/03/opinion/how-bankers-help-drug-traffickers-and-terrorists.html?_r=0

Pollard, N (2006). “UN reports puts world’s illicit drug trade at estimated $321 b”, The Boston Globe.

United Nations Office on Drug and Crimes (2011), World Drugs Report, p.89-90

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Published

2014-08-21

Issue

Vol. 4 No. 8 (2014): August

Section

Article

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