Are current account deficits sustainable?: Evidence from panel cointegration. (English) Zbl 1014.91509

Summary: Conventional cointegration tests fail to consider information across countries, which leads to efficiency loss in estimation. In this article we apply panel cointegration tests to examine the cointegration between exports and imports among the G7. Our findings support the sustainability of current accounts among major industrial countries, which lends support to the intertemporal approach to the current account.


91B64 Macroeconomic theory (monetary models, models of taxation)
91B84 Economic time series analysis
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