Consumption-Based Interest Rate and the Present-Value Model of the Current Account Evidence from Nigeria

30 Pages Posted: 1 Feb 2006

Date Written: July 2001

Abstract

This paper presents a model of current account determination, based upon the permanent-income hypothesis. A present-value relationship among the current account, changes in net output, the exchange rate and the terms of trade is derived and the implications of such a relationship are tested using data for Nigeria during 1960-97.

Keywords: Present-value model, consumption-based interest rate, Nigeria

JEL Classification: F32, F41

Suggested Citation

Adedeji, Olumuyiwa, Consumption-Based Interest Rate and the Present-Value Model of the Current Account Evidence from Nigeria (July 2001). IMF Working Paper, Vol. , pp. 1-30, 2001. Available at SSRN: https://ssrn.com/abstract=879641

Olumuyiwa Adedeji (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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