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Firms’ excess savings and the Dutch current-account surplus: a stock-flow consistent approach


  • Huub Meijers

    (Department of Economics, SBE, Maastricht University and UNU-MERIT, Maastricht, The Netherlands)

  • Joan Muysken

    (Department of Economics, SBE, Maastricht University, CofFEE Europe and UNU-MERIT, Maastricht, The Netherlands)

  • Olaf Sleijpen

    (Department of Economics, SBE, Maastricht University, Maastricht and De Nederlandsche Bank, Amsterdam, The Netherlands)


Retained profits of firms exceed investment in the Netherlands. The resulting net savings are mainly invested in foreign assets, which is consistent with the surplus on the current account of the balance of payments. Both have increased to almost 10 per cent of GDP in recent years. We present a stock-flow consistent model to explain firms’ excess savings, inspired by Hein (2012), in an open economy context. This enables us to model the preference of firms to invest in financial assets abroad and to analyse the observed close link between firms’ excess savings and the current-account surplus. As a consequence, we also explain the close relationship between net household savings and government budget deficit. We present simulation results to illustrate the workings of our model.

Suggested Citation

  • Huub Meijers & Joan Muysken & Olaf Sleijpen, 2016. "Firms’ excess savings and the Dutch current-account surplus: a stock-flow consistent approach," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 13(3), pages 339-353, December.
  • Handle: RePEc:elg:ejeepi:v:13:y:2016:i:3:p339-353

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    Cited by:

    1. Muysken, Joan & Bonekamp, Bas & Meijers, Huub, 2017. "Stock-flow consistent data for the Dutch economy, 1995-2015," MERIT Working Papers 2017-045, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item


    stock-flow consistent modelling; retained profits; current-account surplus;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • F45 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Macroeconomic Issues of Monetary Unions
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill


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