全球智库信息集成服务系统(G2TT): DP14104 On the Relationship Between Domestic Saving and the Current Account: Evidence and Theory for Developing Countries

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来源类型	Discussion paper
规范类型	论文
来源ID	DP14104
	DP14104 On the Relationship Between Domestic Saving and the Current Account: Evidence and Theory for Developing Countries
	Evi Pappa; Markus Brueckner; Wojtek Paczos
发表日期	2019-11-06
出版年	2019
语种	英语
摘要	We examine the relationship between domestic saving and the current account in developing countries. Our three main findings are that domestic saving has: (i) a small effect on the current account; (ii) a significant positive and quantitatively sizable effect on the trade balance; (iii) a significant negative effect on net-current transfers. We use countries in the sub-Saharan African region as a laboratory for an instrumental variables approach. The IV approach enables to obtain estimates of causal effects. Underlying the IV approach is the significant positive first-stage response of domestic saving to plausibly exogenous annual rainfall: an unanticipated, transitory supply-side shock. We construct a small open-economy DSGE model with debt adjustment frictions and endogenous net-current transfers to match the empirical findings. The model enables to examine how other types of shocks – such as changes in interest rates or trend TFP for which it is hard to get exogenous variation in the data – affect the relationship between domestic saving and the current account. An important implication of our findings is that, for developing countries, estimates of the relationship between domestic saving and domestic investment are not informative for answering the question how domestic saving affects a country's accumulation of net foreign assets.
主题	International Macroeconomics and Finance
关键词	Domestic saving Current account Net current transfers Small open economy model Financial frictions Feldstein-horioka puzzle
URL	https://cepr.org/publications/dp14104
来源智库	Centre for Economic Policy Research (United Kingdom)
资源类型	智库出版物
条目标识符	http://119.78.100.153/handle/2XGU8XDN/542991
推荐引用方式 GB/T 7714	Evi Pappa,Markus Brueckner,Wojtek Paczos. DP14104 On the Relationship Between Domestic Saving and the Current Account: Evidence and Theory for Developing Countries. 2019.