Current account dynamics under information rigidity and imperfect capital mobility

International Portfolios, Current Account Dynamics and Capital Accumulation

Despite the liberalization of capital ‡ows among OECD countries, equity home bias remains sizable, but is now less severe than in earlier decades; as a result, ‡uctuations in returns on foreign assets have a substantial e¤ect on countries’wealth. As documented in this paper, changes in net foreign asset positions (NFA) are highly volatile, serially uncorrelated and countercyclical. We show that...

International Capital Mobility and Current Account Targeting in Central and Eastern European Countries

The paper examines the degree of financial integration in five central and eastern European economies on the basis of saving-investment correlations. A comparison with eleven member states of the European monetary union shows that the countries under review have already reached a higher degree of integration in quantitative terms. Since this approach is sensitive to current account targeting po...

Capital mobility and current account imbalance: Nonlinear threshold vector autoregression approach

International capital mobility: An alternative test based on intertemporal current account models

Article history: Received 12 September 2008 Received in revised form 14 July 2009 Accepted 15 August 2009 Available online 4 September 2009 This paper examines international capital mobility by estimating intertemporal current account models for nine major industrialized countries. To account for the large fluctuations of oil prices (the terms-of-trade) and their effects on the current account,...

Unit root tests of the current account balance: implications for international capital mobility

Unit Root Tests Of The Current Account Balance: Implications For International Capital Mobility