Do Oil-Rich GCC Countries Finance US Current Account Deficit?
Given the secrecy that wraps the flows of the GCC countries petrodollar surpluses to the United States and the pressures on these countries to spend and recycle more, this study attempts to uncover the direct and reverse causal relationships between the GCC financial accounts and the US current account deficit. It examines whether the GCC petrodollar surpluses are a global savings glut (an external factor) that causes the US current account deficit or in contrary this deficit is home-grown and the petrodollar savings glut hypothesis does not hold. It particularly focuses on worlds largest oil exporter to find out if the homegrown deficit hypothesis for the worlds largest oil consumer holds. It also investigates which types of investments or components of GCC financial accounts help cause the US deficit the most. The implications and policy recommendations for this growing source of global external imbalances are also provided.
|Date of creation:||2008|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.ael.ethz.ch/|
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:zbw:gdec08:38. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)
If references are entirely missing, you can add them using this form.