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Testing for the sustainability of the current account deficit in two industrial countries

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  • Jyh-lin, Wu
  • Fountas, Stilianos
  • Show-lin, Chen

Abstract

TThe objective of this paper is to test for the sustainability of the current account deficits in the U.S. and Canada over the 1973--1994 period. Using various unit root and cointegration tests some of which allow for structural changes, we conclude that the real current account deficits-to-GDP ratios are not sustainable.
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  • Jyh-lin, Wu & Fountas, Stilianos & Show-lin, Chen, 1996. "Testing for the sustainability of the current account deficit in two industrial countries," Economics Letters, Elsevier, vol. 52(2), pages 193-198, August.
    • Handle: RePEc:eee:ecolet:v:52:y:1996:i:2:p:193-198
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    JEL classification:

    • F30 - International Economics - - International Finance - - - General

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