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Present Value Tests of the Current Account with Durables Consumption

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Author Info
Iscan, T.

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Abstract

The present value tests of intertemporal model of the current account usually assume that all goods are traded and that aggregate consumption decisions can be closely approximated by a random walk process. This paper extends these models by explicitly introducing durables and nontraded goods into an intertemporal model of the current account, and tests the model using Canadian data.

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Publisher Info
Paper provided by Dalhousie, Department of Economics in its series Department of Economics at Dalhousie University working papers archive with number 99-04.

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Length: 24 pages
Date of creation: 1999
Date of revision:
Handle: RePEc:dal:wparch:99-04

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Related research
Keywords: TRADE CANADA CURRENT ACCOUNT

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Find related papers by JEL classification:
F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Park, Joon Y, 1992. "Canonical Cointegrating Regressions," Econometrica, Econometric Society, vol. 60(1), pages 119-43, January. [Downloadable!] (restricted)
  2. Maurice Obstfeld, 1994. "Are Industrial-Country Consumption Risks Globally Diversified?," NBER Working Papers 4308, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Mankiw, N. Gregory, 1982. "Hall's consumption hypothesis and durable goods," Journal of Monetary Economics, Elsevier, vol. 10(3), pages 417-425. [Downloadable!] (restricted)
  4. Matsuyama, Kiminori, 1990. "Residential investment and the current account," Journal of International Economics, Elsevier, vol. 28(1-2), pages 137-153, February. [Downloadable!] (restricted)
  5. Campbell, John Y, 1987. "Does Saving Anticipate Declining Labor Income? An Alternative Test of the Permanent Income Hypothesis," Econometrica, Econometric Society, vol. 55(6), pages 1249-73, November. [Downloadable!] (restricted)
    Other versions:
  6. Shibata, Akihisa & Shintani, Mototsugu, 1998. "Capital mobility in the world economy: an alternative test," Journal of International Money and Finance, Elsevier, vol. 17(5), pages 741-756, October. [Downloadable!] (restricted)
  7. Iscan, Talan B., 2000. "The terms of trade, productivity growth and the current account," Journal of Monetary Economics, Elsevier, vol. 45(3), pages 587-611, June. [Downloadable!] (restricted)
  8. Lewis, Karen K, 1996. "What Can Explain the Apparent Lack of International Consumption Risk Sharing?," Journal of Political Economy, University of Chicago Press, vol. 104(2), pages 267-97, April. [Downloadable!] (restricted)
  9. Assaf Razin & Andrew Rose, 1994. "Business Cycle Volatility and Openness: An Exploratory Cross-Section Analysis," NBER Working Papers 4208, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  10. José De Gregorio & Pablo E. Guidotti & Carlos A. Végh, 1998. "Inflation Stabilization and the Consumption of Durable Goods," Documentos de Trabajo 26, Centro de Economía Aplicada, Universidad de Chile. [Downloadable!]
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  11. Robert J. Barro & Xavier Sala-i-Martin, 1991. "World Real Interest Rates," NBER Working Papers 3317, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  12. Ghosh, Atish R, 1995. "International Capital Mobility amongst the Major Industrialised Countries: Too Little or Too Much?," Economic Journal, Royal Economic Society, vol. 105(428), pages 107-28, January. [Downloadable!] (restricted)
  13. Newey, Whitney K & West, Kenneth D, 1994. "Automatic Lag Selection in Covariance Matrix Estimation," Review of Economic Studies, Blackwell Publishing, vol. 61(4), pages 631-53, October. [Downloadable!] (restricted)
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  14. John V. Leahy & Joseph Zeira, 2000. "The Timing of Purchases and Aggregate Fluctuations," NBER Working Papers 7672, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  15. Glick, Reuven & Rogoff, Kenneth, 1995. "Global versus country-specific productivity shocks and the current account," Journal of Monetary Economics, Elsevier, vol. 35(1), pages 159-192, February. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. José M. Campa & Ángel Gavilán, 2006. "Current accounts in the euro area: An intertemporal approach," Banco de España Working Papers 0638, Banco de España. [Downloadable!]
    Other versions:
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