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Current account and structural change in European transition economies

Author

Listed:
  • Simeon Coleman

    (School of Business and Economics, Loughborough University, UK)

  • Juan Carlos Cuestas

    (Department of Economics, Universitat Jaume I, Castellón, Spain)

Abstract

How have the transition economies’ current accounts evolved? How similar are the factors that have influenced their evolution in each of these countries? In this paper, we examine the evolution of the current account in Central and Eastern European countries and the relationship with the main fundamentals. We employ dynamic ordinary least squares (DOLS) and Threshold Estimation methods to examine the relationship with its main fundamentals (i.e., the Real Exchange Rate, Terms of Trade, Investment, Government Consumption and Income). Our results suggest that the long-run determinants of the current account have indeed changed over time. In addition, the threshold cointegrated estimates show that the parameters are dependent on thresholds for certain variables.

Suggested Citation

  • Simeon Coleman & Juan Carlos Cuestas, 2019. "Current account and structural change in European transition economies," Working Papers 2019/08, Economics Department, Universitat Jaume I, Castellón (Spain).
    • Handle: RePEc:jau:wpaper:2019/08
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    References listed on IDEAS

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    Cited by:

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    More about this item

    Keywords

    Current account; Central and Eastern Europe; structural breaks; European integration.;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements

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