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Jackknife Model Averaging of the Current Account Determinants


  • Branko Urošević

    () (National Bank of Serbia; Faculty of Economics, University of Belgrade, Serbia)

  • Milan Nedeljković

    () (National Bank of Serbia; Faculty of Economics, Finance and Administration, Singidunum University, Belgrade, Serbia)

  • Emir Zildžović

    () (National Bank of Serbia; Serbia)


This paper investigates the short to medium-term empirical relationships between the current account balances and a broad set of macroeconomic determinants in Serbia and selected CEE countries. Using novel model averaging techniques we focus the analysis to individual country’s data only. The results suggest that the model tracks the current account movements over the past decade quite well and captures its relative volatility. Signs and magnitudes of different coefficients indicate significant heterogeneity among countries providing empirical support for the country-level analysis.

Suggested Citation

  • Branko Urošević & Milan Nedeljković & Emir Zildžović, 2012. "Jackknife Model Averaging of the Current Account Determinants," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 59(3), pages 267-281, June.
  • Handle: RePEc:voj:journl:v:59:y:2012:i:3:p:267-281

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    References listed on IDEAS

    1. Chinn, Menzie D. & Prasad, Eswar S., 2003. "Medium-term determinants of current accounts in industrial and developing countries: an empirical exploration," Journal of International Economics, Elsevier, vol. 59(1), pages 47-76, January.
    2. Paolo Zanghieri, 2004. "Current Accounts Dynamics in new EU members: Sustainability and Policy Issues," Working Papers 2004-07, CEPII research center.
    3. Liu, Chu-An, 2012. "A plug-in averaging estimator for regressions with heteroskedastic errors," MPRA Paper 41414, University Library of Munich, Germany.
    4. Charles Engel & John H. Rogers, 2006. "The U.S. current account deficit and the expected share of world output," Proceedings, Federal Reserve Bank of San Francisco, issue Jun.
    5. Maurice Obstfeld & Kenneth S. Rogoff, 1996. "Foundations of International Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262150476, July.
    6. Bussière, Matthieu & Fratzscher, Marcel, 2006. "Current Account Dynamics in OECD Countries and in the New EU Member States: An Intertemporal Approach," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 21, pages 593-618.
    7. Nason, James M. & Rogers, John H., 2006. "The present-value model of the current account has been rejected: Round up the usual suspects," Journal of International Economics, Elsevier, vol. 68(1), pages 159-187, January.
    8. Paul Cashin & Samya Beidas-Strom, 2011. "Are Middle Eastern Current Account Imbalances Excessive?," IMF Working Papers 11/195, International Monetary Fund.
    9. Sheffrin, Steven M. & Woo, Wing Thye, 1990. "Present value tests of an intertemporal model of the current account," Journal of International Economics, Elsevier, vol. 29(3-4), pages 237-253, November.
    10. Hansen, Bruce E. & Racine, Jeffrey S., 2012. "Jackknife model averaging," Journal of Econometrics, Elsevier, vol. 167(1), pages 38-46.
    11. Bruce E. Hansen, 2007. "Least Squares Model Averaging," Econometrica, Econometric Society, vol. 75(4), pages 1175-1189, July.
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    Cited by:

    1. Yusuf Ekrem Akbas & Mehmet Senturk & Canan Sancar, 2013. "Testing for Causality between the Foreign Direct Investment, Current Account Deficit, GDP and Total Credit: Evidence from G7," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 60(6), pages 791-812, December.
    2. Alka Obadić & Tomislav Globan & Ozana Nadoveza, 2014. "Contradicting the Twin Deficits Hypothesis: The Role of Tax Revenues Composition," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 61(6), pages 653-667, December.
    3. Nikolina E. Kosteletou, 2013. "Financial Integration, Euro and the Twin Deficits of Southern Eurozone Countries," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 60(2), pages 161-178, April.

    More about this item


    Current account; Model averaging; Transition countries.;

    JEL classification:

    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements


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