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Testing for the Sustainability of the Current Account Deficit in Two Industrial Countries

Author

Listed:
  • Jyh-lin Wu
  • Stilianos Fountas

    (Department of Economics, National University of Ireland, Galway)

  • 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.

Suggested Citation

  • Jyh-lin Wu & Stilianos Fountas & Show-lin Chen, 1996. "Testing for the Sustainability of the Current Account Deficit in Two Industrial Countries," Working Papers 11, National University of Ireland Galway, Department of Economics, revised 1996.
  • Handle: RePEc:nig:wpaper:0011
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    References listed on IDEAS

    as
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    JEL classification:

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

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