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Productivity shocks, budget deficits and the current account

Bussière, Matthieu; Fratzscher, Marcel; Müller, Gernot J. - 2005

Currently the U.S. is experiencing record budget and current account deficits, a phenomenon familiar from the "Twin Deficits" discussion of the 1980s. In contrast, during the 1990s productivity growth has been identified as the primary cause of the US current account deficit. We suggest a...

Persistent link: https://www.econbiz.de/10011604555

Fiscal policies, the current account and Ricardian equivalence

Nickel, Christiane; Vansteenkiste, Isabel - 2008

This paper analyses the empirical relationship between fiscal policy and the current account of the balance of payments and considers how Ricardian equivalence changes this relationship. To do so, we estimate a dynamic panel threshold model for 22 industrialised countries in which the...

Persistent link: https://www.econbiz.de/10011604981

Trade imbalances and multilateral trade cooperation

Marchetti, Juan; Ruta, Michele; Teh, Robert - 2012

Rising current account and merchandise trade imbalances marked the years before the global financial and economic crisis. These imbalances either contributed to or precipitated the crisis and to the extent that they create systemic risks, it is desirable that they be reduced. There are many...

Persistent link: https://www.econbiz.de/10010326809

The persistence of current account balances and its determinants: The implications for global rebalancing

Clower, Erica; Ito, Hiro - 2012

This paper examines the statistical nature of the persistency of current account balances and its determinants. With the assumption that stationary current account series ensures the long-run budget constraint while countries may experience "local non-stationarity" in current account balances,...

Persistent link: https://www.econbiz.de/10010397237

Causes and Consequences of Global Imbalances: Perspective from Developing Asia

Adams, Charles; Park, Donghyun - 2009

Global current account imbalances are one of the key macroeconomic imbalances that underlie the global financial crisis. The central objective of this paper is to analyze the causes and consequences of global imbalances from the perspective of developing Asia. More specifically, we examine the...

Persistent link: https://www.econbiz.de/10010507261

A framework for assessing global imbalances

Bracke, Thierry; Bussière, Matthieu; Fidora, Michael; … - 2008

In this paper, we take a systematic look at global imbalances. First, we provide a definition of the phenomenon, and relate global imbalances to widening external positions of systemically important economies that reflect distortions or entail risks for the global economy. Second, we provide an...

Persistent link: https://www.econbiz.de/10011606230

Current account benchmarks for central and eastern Europe: a desperate search?

Ca' Zorzi, Michele; Chudik, Alexander; Dieppe, Alistair - 2009

This paper examines two competing approaches for calculating current account benchmarks, i.e. the external sustainability approach á la Lane and Milesi-Ferretti (LM) versus the structural current accounts literature (SCA) based on panel econometric techniques. The aim is to gauge the medium...

Persistent link: https://www.econbiz.de/10011605041

Methodological advances in the assessment of equilibrium exchange rates

Bussière, Matthieu; Ca' Zorzi, Michele; Chudik, Alexander - 2010

This paper reviews three different concepts of equilibrium exchange rates that are widely used in policy analysis and constitute the backbone of the IMF CGER assessment: the Macroeconomic Balance, the External Sustainability and the reduced form approaches. We raise a number of econometric...

Persistent link: https://www.econbiz.de/10011605197

Analyzing the Present Sustainability of Turkey’s Current Account Position

Oğuş, Ayla; Sohrabji, Niloufer - 2008

In this paper we assess the present sustainability of Turkey's current account position using the framework provided by … conclude that Turkey's internal structure and macroeconomic conditions (such as exports and the fiscal position) have improved … that are allowing Turkey to continue having large and increasing current account deficits. However, there is vulnerability …

Persistent link: https://www.econbiz.de/10011807189

Intertemporal solvency of Turkey’s current account

Oğuş Binatlı, Ayla; Sohrabji, Niloufer - 2008

We test for sustainability of Turkey's current account position between 1992 and 2007 using the intertemporal solvency … tests to determine linkages between exports and imports+ in Turkey. Using the Johansen test we find no cointegration and …

Persistent link: https://www.econbiz.de/10011807191