An Investigation of Current Account Solvency in Latin America Using Non Linear Stationarity Tests
U of London Queen Mary Economics Working Paper No. 485
14 Pages Posted: 29 Mar 2003
Date Written: January 2003
Using a new methodology that allows for nonlinearities, we find frequent support for sustainability in the debt of a set of Latin American countries. Our findings overturn results obtained with traditional unit-root tests and provide a more realistic alternative to evaluate the external solvency of an economy.
JEL Classification: C22, F32, F34
Suggested Citation: Suggested Citation