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The U.S. Current Account and Real Effective Dollar Exchange Rates


  • Joscha Beckmann

    () (University of Duisburg-Essen, Department of Economics, Chair for Macroeconomics, 45117 Essen)

  • Ansgar Belke

    () (IZA Bonn and University of Duisburg-Essen, Department of Economics, Chair for Macroeconomics, 45117 Essen)

  • Robert Czudaj

    () (University of Duisburg-Essen, Department of Economics, Chair for Econometrics, 45117 Essen and FOM Hochschule für Oekonomie & Management, University of Applied Sciences, Herkulesstr. 32, 45127 Essen)


This study analyzes long-run and short-run dynamics between the current account and the real effective dollar exchange rates from a novel perspective. Applying multivariate cointegration techniques, we first test for a long-run relationship between the real effective dollar exchange rate and the U.S. current account. We then include further macroeconomic factors as an extension. As a next step, we pay particular attention to the evolvement of the coefficients over time based on an estimation of a time varying coefficient approach by means of Kalman filtering.

Suggested Citation

  • Joscha Beckmann & Ansgar Belke & Robert Czudaj, 2013. "The U.S. Current Account and Real Effective Dollar Exchange Rates," Credit and Capital Markets, Credit and Capital Markets, vol. 46(2), pages 213-232.
  • Handle: RePEc:kuk:journl:v:46:y:2013:i:2:p:213-232

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    References listed on IDEAS

    1. Beck, Thorsten & Laeven, Luc, 2006. "Resolution of failed banks by deposit insurers : cross-country evidence," Policy Research Working Paper Series 3920, The World Bank.
    2. Schoenmaker, Dirk & Gros, Daniel, 2012. "A European Deposit Insurance and Resolution Fund," CEPS Papers 6918, Centre for European Policy Studies.
    3. Jean Pisani-Ferry & André Sapir & Nicolas Véron & Guntram B. Wolff, 2012. "What kind of European banking union?," Policy Contributions 731, Bruegel.
    4. Schoenmaker, Dirk & Gros, Daniel, 2012. "A European Deposit Insurance and Resolution Fund - An Update," CEPS Papers 7276, Centre for European Policy Studies.
    5. Jean Pisani-Ferry & Guntram B. Wolff, 2012. "The fiscal implications of a banking union," Policy Briefs 748, Bruegel.
    6. André Sapir & Jean Pisani-Ferry & Nicolas Véron & Guntram Wolff, 2012. "What Kind of Banking Union ?," ULB Institutional Repository 2013/174288, ULB -- Universite Libre de Bruxelles.
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    More about this item


    multivariate cointegration; current account; real exchange rates; time-varying coefficient approach;

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • F31 - International Economics - - International Finance - - - Foreign Exchange


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