The US current account, sustainability, and the international monetary system

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F62156489%3A43110%2F21%3A43920401" target="_blank" >RIV/62156489:43110/21:43920401 - isvavai.cz</a>

Výsledek na webu

<a href="https://doi.org/10.1016/j.ecosys.2021.100875" target="_blank" >https://doi.org/10.1016/j.ecosys.2021.100875</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.1016/j.ecosys.2021.100875" target="_blank" >10.1016/j.ecosys.2021.100875</a>

Jazyk výsledku

angličtina

Název v původním jazyce

The US current account, sustainability, and the international monetary system

Popis výsledku v původním jazyce

In this paper, we examine the sources of the US current account imbalances and discuss the role of the international monetary system in enabling the US in carrying such external deficits. There is evidence that the stochastic properties of the US current account are not compatible with the intertemporal national budget constraint. We argue that this is likely to be related to the dominant role of the U.S. dollar as an international reserve asset, which allows the US to meet international demand for safe assets and allows borrowing at very low interest rates. Results from a structural VAR model indicate that temporary shocks dominate the current account in the short run, whereas domestic permanent supply shocks and preference shocks contribute significantly to US current account movements in the long run. To the extent that temporary shocks stem from aggregate demand, stabilizing aggregate demand is important in achieving long-term sustainability in the current account. Finally, the paper discusses the role of the international financial system and the international role of the U.S. dollar in contributing to US external imbalances.

Název v anglickém jazyce

The US current account, sustainability, and the international monetary system

Popis výsledku anglicky

In this paper, we examine the sources of the US current account imbalances and discuss the role of the international monetary system in enabling the US in carrying such external deficits. There is evidence that the stochastic properties of the US current account are not compatible with the intertemporal national budget constraint. We argue that this is likely to be related to the dominant role of the U.S. dollar as an international reserve asset, which allows the US to meet international demand for safe assets and allows borrowing at very low interest rates. Results from a structural VAR model indicate that temporary shocks dominate the current account in the short run, whereas domestic permanent supply shocks and preference shocks contribute significantly to US current account movements in the long run. To the extent that temporary shocks stem from aggregate demand, stabilizing aggregate demand is important in achieving long-term sustainability in the current account. Finally, the paper discusses the role of the international financial system and the international role of the U.S. dollar in contributing to US external imbalances.

Druh

J_imp - Článek v periodiku v databázi Web of Science

CEP obor

—

OECD FORD obor

50206 - Finance

Projekt

—

Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2021

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

Economic Systems

ISSN

0939-3625

e-ISSN

—

Svazek periodika

45

Číslo periodika v rámci svazku

4

Stát vydavatele periodika

NL - Nizozemsko

Počet stran výsledku

14

Strana od-do

100875

Kód UT WoS článku

000727503700007

EID výsledku v databázi Scopus

2-s2.0-85117374415