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Determinants Of The Current Account In The Eu And Piigs

Author

Listed:
  • Natalya Ketenci

    (Yeditepe University, Istanbul, Turkey)

  • Idil Uz Akdogan

    (Yeditepe University, Istanbul, Turkey)

  • Hatice Kerra Geldi

    (Yeditepe University, Istanbul, Turkey)

Abstract

This paper investigates the relationship between current account balance and national savings, investment, budget deficit, and real exchange rate. These determinants of the current account are studied empirically by applying the Generalized Method of Moments for a sample of 24 European countries. The sample data are divided into three different groups, PIIGS, EU-PIIGS, and EU in order to study the group-specific estimations. The main result of the paper is that the determinants of our model are capable of accurately explaining past movements in current accounts for all selected groups. Additionally, current account determinants in the economically weak members, PIIGS, behave slightly differently from the rest of the EU.

Suggested Citation

  • Natalya Ketenci & Idil Uz Akdogan & Hatice Kerra Geldi, 2014. "Determinants Of The Current Account In The Eu And Piigs," Journal Articles, Center For Economic Analyses, pages 5-14, December.
    • Handle: RePEc:cmk:journl:y:2014:p:5-14
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    File URL: http://journal.cea.org.mk/files/journals/1/articles/16/public/16-62-1-PB.pdf
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    References listed on IDEAS

    as
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    Keywords

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    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

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