Co-integrating relationship between terms of trade and current account deficit: the Australian evidence

Asraul Hoque

Applied Economics Letters, 1995, vol. 2, issue 4, 130-133

Abstract: This paper examines the relationship between terms of trade and current account deficit (CAD) in Australia using the co-integration approach. The period covered is 1965:I to 1992:IV. Assuming that different exchange rate regimes will have different impacts on the relationship, the study considers three different exchange rate regimes for the period covered. The empirical results indicate that terms of trade along with domestic income and foreign income has a significant long-term relationship with the trade balance during the fixed exchange rate regime (1965:I to 1974:III), but not during the flexible exchange rate period. In other words, terms of trade did not have significant impact on Australia's current account deficit in the flexible exchange rate regime under study.

Date: 1995
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://www.informaworld.com/openurl?genre=article& ... 40C6AD35DC6213A474B5 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:apeclt:v:2:y:1995:i:4:p:130-133

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RAEL20

DOI: 10.1080/758529820

Access Statistics for this article

Applied Economics Letters is currently edited by Anita Phillips

More articles in Applied Economics Letters from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().