Global Imbalances and Petrodollars

Rabah Arezki () and Fuad Hasanov

No 09/89, IMF Working Papers from International Monetary Fund

Abstract: Oil exporters have run large current account surpluses. We explore oil exporters' role in our understanding and the resolution of global imbalances. Current account dynamics are estimated for oil-exporting countries and the rest of the world. We find that fiscal policy has a much stronger effect on current account of oil exporters than on current account of other countries. The current account adjustment of oil-exporting countries is also faster than that of other countries. We conclude that a change in fiscal policy of oil exporters can have significant and speedy impact on global imbalances.

Keywords: Payments imbalances; Oil exporting countries; Oil prices; Oil revenues; Current account; Current account surpluses; Fiscal policy (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ara, nep-cba, nep-ene and nep-opm
Date: Written
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