Thousands of models, one story: current account imbalances in the global economy

Ca' Zorzi, Michele, Alexander Chudik and Alistair Dieppe ()

No 100, Globalization and Monetary Policy Institute Working Paper from Federal Reserve Bank of Dallas

Abstract: The global financial crisis has led to a revival of the empirical literature on current account imbalances. This paper contributes to that literature by investigating the importance of evaluating model and parameter uncertainty prior to reaching any firm conclusion. We explore three alternative econometric strategies: examining all models, selecting a few, and combining them all. Out of thousands (or indeed millions) of models a story emerges. The chance that current accounts were aligned with fundamentals prior to the financial crisis appears to be minimal.

Keywords: Macroeconomics; -; Econometric; models (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-cba and nep-opm
Date: 2011
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Related works:
Journal Article: Thousands of models, one story: Current account imbalances in the global economy (2012)
Working Paper: Thousands of models, one story: current account imbalances in the global economy (2012)
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