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Current Account Imbalances in the Euro Area: A Comparative Perspective

  • Sebastian Barnes
  • Jeremy Lawson
  • Artur Radziwill

This paper considers the increase in current account imbalances in euro area countries since the early 1990s. While the euro area as a whole has remained relatively close to external balance, the current account balances of individual countries have diverged: Spain, Greece and Portugal ran large current account deficits by historical norms for industrial economies, while Germany and the Netherlands ran large surpluses. These imbalances are larger and more sustained than those observed in recent decades. While there has been extensive discussion of the US and Chinese external positions in the context of the debate on global imbalances, more attention has been given to the developments in the euro area only in the wake of the recent sovereign debt crisis. This paper uses a period-average model estimated on data for OECD countries since the late 1960s to investigate the determinants of current account imbalances. Fundamental economic factors are found to play an important role, in line with earlier studies, but do not fully explain the extent of imbalances over the past decade. The strength of housing investment appears to capture important effects over this period. This working paper relates to the 2010 OECD Economic Survey of the Euro Area ( Les déséquilibres de la balance courante dans la zone euro : une perspective comparative Ce document analyse l’augmentation des déséquilibres de la balance courante dans les pays de la zone euro depuis le début des années 90. Si le solde extérieur de la zone euro dans son ensemble est resté relativement proche de l’équilibre, les soldes des opérations courantes des pays pris individuellement ont divergé : l’Espagne, la Grèce et le Portugal ont connu d’importants déficits de la balance courante sur la base des normes historiques des économies industrielles, tandis que l’Allemagne et les Pays-Bas ont connu d’amples excédents. Ces déséquilibres sont plus importants et plus marqués que ceux observés ces dernières décennies. Alors qu’il y a eu de nombreuses études sur les positions extérieures des États-Unis et de la Chine dans le contexte du débat sur les déséquilibres globaux, l’attention ne s’est tourné vers l’évolution de la zone euro qu’à la suite de la récente crise sur les dettes souveraines. Ce document utilise un modèle estimé sur des données qui représentent des moyennes temporelles des pays de l’OCDE depuis la fin des années 60, pour rechercher les déterminants des déséquilibres de la balance courante. Il se trouve que les facteurs économiques fondamentaux y jouent un rôle important, conformément aux études antérieures, mais ils n’expliquent pas entièrement l’ampleur des déséquilibres au cours de la dernière décennie. La vigueur de l’investissement en logement semble expliquer des effets importants au cours de cette période. Ce document de travail porte sur l'Étude économique du Zone euro. (

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Paper provided by OECD Publishing in its series OECD Economics Department Working Papers with number 826.

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Date of creation: 09 Dec 2010
Date of revision:
Handle: RePEc:oec:ecoaaa:826-en
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