Global Imbalances: The Role of Non-TradableTotal Factor Productivity in Advanced Economies

 
Author/Editor: Cova, Pietro ; Pisani, Massimiliano ; Batini, Nicoletta ; Rebucci, Alessandro
 
Publication Date: March 01, 2009
 
Electronic Access: Free Full text (PDF file size is 510KB).
Use the free Adobe Acrobat Reader to view this PDF file

 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
 
Summary: This paper investigates the role played by total factor productivity (TFP) in the tradable and nontradable sectors of the United States, the euro area, and Japan in the emergence and evolution of today's global trade imbalances. Simulation results based on a dynamic general equilibrium model of the world economy, and using the EU KLEMS database, indicate that TFP developments in these economies can account for a significant fraction of the total deterioration in the U.S. trade balance since 1999, as well as account for some the surpluses in the euro area and Japan. Differences in TFP developments across sectors can also partially explain the evolution of the real effective value of the U.S. dollar during this period.
 
Series: Working Paper No. 09/63
Subject(s): Payments imbalances | United States | European Union | Japan | Developed countries | Productivity | Balance of trade | Economic models | Time series | Cross country analysis

Author's Keyword(s): global imbalances | productivity | trade deficit | exchange rates | non-tradable sector | GEM
 
English
Publication Date: March 01, 2009
Format: Paper
Stock No: WPIEA2009063 Pages: 39
Price:
US$18.00 (Academic Rate:
US$18.00 )
 
 
Please address any questions about this title to publications@imf.org