Purpose – The purpose of this paper is to contribute further on the twin deficits debate in a developing economy. Design/methodology/approach – The data for Thailand over three decades are used as a case study. Findings – The major findings are: first, a stable, long-run equilibrium...

Purpose – The purpose of this paper is to contribute further on the twin deficits debate in a developing economy. Design/methodology/approach – The data for Thailand over three decades are used as a case study. Findings – The major findings are: first, a stable, long‐run equilibrium...

This paper examines the twin deficits hypothesis in the ASEAN countries. The major findings of this paper are the following. (1) Long run relationships are detected between budget and current account deficits. (2) The Keynesian view fits well for Thailand since the causality runs from budget...