Abstract:This paper examines the regional and global growth effects of current account imbalances in Japan, Germany, and the People's Republic of China (PRC)-the three largest persistent surplus countries-and the United States and United Kingdom, the two largest persistent deficit countries. Controlling for a set of macroeconomic determinants, we use a structural vector autoregression (SVAR) framework to show that positive shocks to current account balances in the PRC, Germany, and Japan transmit positive regional and … Show more
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