A record current account deficit: causes and implications
Jack Hervey and
Loula S. Merkel
Economic Perspectives, 2000, issue Q IV, No v. 25, no. 4, 2-13
The U.S. current account deficit was at a record level in 1999 and is expected to increase further in 2000. How large can this deficit get? Will an eventual adjustment in the deficit place the U.S. economy at risk? This article examines three arguments often put forth to explain the increase in the deficit--a consumption boom, the U.S. as a safe haven for short-term foreign capital and technological change affecting the U.S. economy. The authors find the strongest evidence in support of technological change and suggest why, under these conditions, an economic adjustment to the deficit need not to have as adverse an impact as some observes fear.
Keywords: Deficit financing; Economic conditions - United States (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6) Track citations by RSS feed
Downloads: (external link)
http://www.chicagofed.org/digital_assets/publicati ... tives/2000/4qep1.pdf (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedhep:y:2000:i:qiv:p:2-13:n:v.25no.4
Ordering information: This journal article can be ordered from
http://www.chicagofe ... ation_order_form.cfm
Access Statistics for this article
More articles in Economic Perspectives from Federal Reserve Bank of Chicago Contact information at EDIRC.
Bibliographic data for series maintained by Bernie Flores ().