The determinants of current account imbalances in the euro area: a panel estimation approach

Sophocles Brissimis, George Hondroyiannis, Christos Papazoglou, Nicholas Tsaveas and Melina Vasardani

Economic Change and Restructuring, 2013, vol. 46, issue 3, 299-319

Abstract: The aim of this paper is to study the main macroeconomic, financial and structural characteristics that affected current account developments in the member-states of the euro area over the period 1980–2008. The model is based on the intertemporal consumption smoothing approach according to which current account positions are determined by saving and investment decisions. The analysis uses a panel of countries that consists of the initial 12 member states of the euro area and then it expands to 17 countries aiming to see whether the enlargement or potential enlargement would in any way alter the current account determinants. All the determinants of saving and investment decisions, which include factors such as the level of development, demographics, macroeconomic policies and competitiveness, appear to be important in underpinning sustained current account positions in the euro area countries. Copyright Springer Science+Business Media New York 2013

Keywords: Intertemporal current account model; Current account sustainability; F30; F32 (search for similar items in EconPapers)
Date: 2013
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Working Paper: The determinants of current account imbalances in the Euro Area: a panel estimation approach (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:kap:ecopln:v:46:y:2013:i:3:p:299-319

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DOI: 10.1007/s10644-012-9129-0

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