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Optimality of the current account of the Spanish economy, 1850-2015

Author

Listed:
  • Oscar Bajo-Rubio

    (Department of Economics, Universidad de Castilla-La Mancha, 13071 Ciudad Real, Spain)

  • Vicente Esteve

    (Department of Economic Structure, University of Valencia, Avda. dels Tarongers s/n, 46022 Valencia, Spain)

Abstract

We analyse the possible optimality of the path followed by the current account of the Spanish economy over the period 1850-2015, according to the intertemporal approach to the current account and using a present-value model. In particular, from the estimation of a bivariate VAR model for the current account, we try to assess to which extent the latter has been used to smooth private consumption along time in the presence of temporary shocks that the economy might suffer. In general, the evidence does not seem to be particularly favourable to the validity of the model over the period of analysis.

Suggested Citation

  • Oscar Bajo-Rubio & Vicente Esteve, 2017. "Optimality of the current account of the Spanish economy, 1850-2015," Working Papers 1710, Department of Applied Economics II, Universidad de Valencia.
  • Handle: RePEc:eec:wpaper:1710
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    More about this item

    Keywords

    external imbalances; current account; intertemporal approach; Spanish economy;
    All these keywords.

    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
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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