'Imbalances' for the Long Run
31 Pages Posted: 30 Nov 2012
There are 2 versions of this paper
'Imbalances' for the Long Run
Date Written: November 2012
Abstract
Net exports and current account balances among developed countries,which contributed to the so called “global imbalances”, arehighly persistent. Despite success along many dimensions, internationalbusiness cycle models have difficulty replicating these salient,low-frequency features of international capital flows. In particular,net exports and current account balances are much more persistent in thedata than in standard models. We document these important empiricalfacts about international capital flows. Further, we show that we canaccount for them with a parsimonious one-good two-country model withsmall, persistent differences in per capita GDP growth, matching thosewe observe among developed countries.
Keywords: net exports, current account, technology shocks
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
The Impact of Exchange Rate Movements on U.S. Foreign Debt
By Cédric Tille
-
An Equilibrium Model of Global Imbalances and Low Interest Rates
By Ricardo J. Caballero, Emmanuel Farhi, ...
-
An Equilibrium Model of "Global Imbalances" and Low Interest Rates
By Ricardo J. Caballero, Emmanuel Farhi, ...