Have US external imbalances been determined at home or abroad?

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Title Have US external imbalances been determined at home or abroad?
Author Makin, Anthony John; Narayan, Paresh Kumar
Journal Name Economic Modelling
Editor Stephen Hall
Year Published 2008
Place of publication Netherlands
Publisher Elsevier
Abstract This paper examines the relationship between the United States saving-investment imbalance and long-term real interest rates using a new international borrowing and lending framework. It first establishes how domestic or international factors may primarily influence the US external imbalance and interest rates over any given time before showing that the current account and real long term interest rate share a positive and statistically significant co-integrating relationship based on data from the mid -1980's. The results suggest that while in the pre-Asian financial crisis period (1985:01-1996:04) US external deficits and long term interest rates were mainly determined by domestic factors, external factors beyond the control of domestic policymakers dominated from 1997:01-2004:04.
Peer Reviewed Yes
Published Yes
Publisher URI http://www.elsevier.com/wps/find/journaldescription.cws_home/30411/description#description
Alternative URI http://dx.doi.org/10.1016/j.econmod.2007.08.004
Volume 25
Issue Number 2
Page from 520
Page to 531
ISSN 0264-9993
Date Accessioned 2008-06-02
Language en_AU
Faculty Griffith Business School
Subject International Economics and International Finance
URI http://hdl.handle.net/10072/20404
Publication Type Journal Articles (Refereed Article)
Publication Type Code c1

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