Are African Current Account Deficits Different? Stylized Facts, Transitory Shocks, and Decomposition Analysis

 
Author/Editor: Zanforlin, L. ; Chong, Alberto ; Calderón, César
 
Publication Date: January 01, 2001
 
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Summary: This paper analyzes the behavior of current account deficits in Africa and estimates whether the deficits are excessive with respect to fundamentals. The findings are the deficits are (i) not very persistent; (ii) positively linked with domestic growth; (iii) strongly linked with public (and private) savings, suggesting that fiscal consolidation in IMF-supported programs may be relatively effective; (iv) linked with aid flows, so as to close the external gap, and (v) linked with currency depreciation and the terms of trade. The deficit is "excessive," as it is almost 3 percent of the gross national disposable income above the equilibrium level.
 
Series: Working Paper No. 01/4
Subject(s): Current account deficits | Africa | Economic models | China, People's Republic of

Author's Keyword(s): Current account | Dynamic panel data models | decomposition analysis
 
English
Publication Date: January 01, 2001
ISBN/ISSN: 1934-7073 Format: Paper
Stock No: WPIEA0042001 Pages: 40
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