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

Ca’ Zorzi, Michele, Alexander Chudik and Alistair Dieppe
Authors registered in the RePEc Author Service: Michele Ca' Zorzi

Journal of International Money and Finance, 2012, vol. 31, issue 6, 1319-1338

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: Current account; Global imbalances; Panel data; Model uncertainty; Model combination (search for similar items in EconPapers)
JEL-codes: C11 C33 F32 F34 F41 O52 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (108)

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Related works:
Working Paper: 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 (2011)
Working Paper: Thousands of models, one story: current account imbalances in the global economy (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jimfin:v:31:y:2012:i:6:p:1319-1338

DOI: 10.1016/j.jimonfin.2012.02.003

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