Measuring Indebtedness of Greece, Italy, Portugal and Spain, (GIPS), in Terms of General Government Net Lending/borrowing, General Government Net Debt, Current Account Balance, Total Investment, Gross National Savings, General Government Structural Balance and Output Gap.

2019 ◽  
Author(s):  
Michel Guirguis
Keyword(s):  
Current Account ◽  
Current Account Balance ◽  
Output Gap ◽  
Structural Balance ◽  
General Government ◽  
Total Investment ◽  
Of Greece

Re-Examining Public Debt and Current Account Dynamics in Ethiopia: SVAR Evidence

2020 ◽  
Author(s):  
Wondemhunegn Ezezew Melesse
Keyword(s):  
Current Account ◽  
Public Debt ◽  
Time Series Data ◽  
Emerging Market ◽  
Government Debt ◽  
Debt Management ◽  
Series Data ◽  
Current Account Balance ◽  
Current Account Dynamics ◽  
General Government

Abstract Public debt management is now an integral part of overall macroeconomic management in many developing and emerging market economies. Preventing unsustainable debt accumulation and maintaining healthy fiscal profile begins with understanding its key drivers both in the short- and in the long run. This study applies structural vector auto-regressive (SVAR) model on annual time series data to study general government debt and current account dynamics in Ethiopia for the period 1980–2018. Both the impulse response and forecast error variance decomposition results confirm that fiscal balance exerts the strongest influence on both government debt and current account balance in the short run. In addition, own shock as well as shocks stemming from gross fixed capital formation and growth have significant effects on general government debt. The findings were robust to alternative data transformation, differing Choleski ordering of the model variables, and inclusion of exogenous deterministic terms that capture changes in the political landscape.JEL classification: E60, E63, C32, H63

scholarly journals ANALYSIS OF THE FACTOR OF HOUSEHOLD SAVINGS IN BIH BY APPLICATION OF ECM METHODOLOGY

2020 ◽  
Vol 20 (2) ◽  
Author(s):  
Irma Đidelija
Keyword(s):  
Foreign Trade ◽  
Current Account ◽  
Trade Balance ◽  
Government Expenditure ◽  
Unit Root Test ◽  
Current Account Balance ◽  
Household Savings ◽  
Long Run ◽  
General Government ◽  
The Impact

Savings as an alternative source of capital, in the opinion of most economists, are a much more reliable and rational source of investment funds than others. Therefore, the aim of this research is to determine what factors can drive domestic household savings with further repressions to overall economic growth. This research examined the impact of macroeconomic and financial factors on household savings based on quarterly data from the BiH Agency for Statistics and the Central Bank of Bosnia and Herzegovina for the period 2000-2016. For this purpose, seasoning of variables was done using X-13 ARIMA and TRAMO / SEATS. The stationarity of seasonally adjusted variables was examined through: the extended Dickey-Fuller unit root test, the Phillips-Perrontest unit root test, and the Kwaitkowski-Phillips-Schmidt-Shin stationarity test. The model included only non-stationary first order integration variables, which are also cointegrated, which is a condition for applying the error correction method (ECM). The application of the ECM methodology first required determining the appropriate number of lag in the VAR model and then applying the Johansen cointegration test. The following were used as independent variables in ECM: industrial production, government expenditure in% of GDP, money supply (M2) in% of GDP, foreign trade balance in% of GDP, current account balance in% of GDP, deposit population interest rate and unemployment rate. The variables included are based on ECM methodology criteria, which is the same order of integration and cointegration. Among the long-run interdependence ratios, only general government expenditure ratios in% of GDP, foreign trade balance in% of GDP and current account balance in% of GDP proved to be statistically significantly different from zero. The first two coefficients have a positive sign, while the impact of the current account balance in the gross domestic product is negative. A one percent increase in the share of general government expenditures and foreign trade balance in Gross Domestic Product will in the long run lead to an increase in the household savings rate by 4.1% and 3.5% respectively. The error correction coefficient (EC (-1)) in the short-term part of the model, which measures the rate of equilibrium adaptation in the dynamic model, is with the expected negative sign, but is not statistically significant. The high value of the adjusted coefficient of determination, 0.385, suggests that almost 39% of variations in household savings are explained by variations in the set of independent variables included in the ECM model. The obtained research findings can be significant indicators for adequate monetary and fiscal policy measures in BiH, and can be indicators for the overall macroeconomic policy of the country.

IMF Stabilization Programs, Policy Conduct and Macroeconomic Outcomes: A Case Study of Pakistan

2006 ◽  
Vol 11 (1) ◽  
pp. 35-62
Author(s):  
Nawaz A. Hakro ◽  
Wadho Waqar Ahmed
Keyword(s):  
Current Account ◽  
Inflation Rate ◽  
Current Account Balance ◽  
Macroeconomic Policies ◽  
Explanatory Variables ◽  
Fiscal Balance ◽  
Macroeconomic Impacts ◽  
The Individual ◽  
The Imf

This study is designed to assess the macroeconomic performance of fund-supported programs, and the sequencing and ordering of macroeconomic policies in the context of the Pakistan economy. The generalized evaluation estimator technique has been used to assess the macroeconomic impacts of the IMF supported programs. GDP growth, inflation rate, current account balance, fiscal balance and unemployment are used as the target variables in order to gauge economic performance during the program years. The vector of policy variables (that might have been adopted in the absence of programs) and the vector of foreign exogenous variables are also taken as explanatory variables in the model, so that the individual effect of the IMF supported programs could be assessed. The result suggests that as the IMF prescriptions were applied, the current account balance has worsened, the unemployment rate has significantly increased, and the inflation rate has increased during the years of fund-supported programs. Only the budget balance has shown signs of improvement. Furthermore an inadequate sequencing of reforms has contributed to the further worsening of the economic scenario during the program period.

THE CURRENT GROWTH EFFECT OF HEALTH TOURISM MARKET DEVELOPMENT IN TURKEY FOR THE EVALUATION ON CURRENT ACCOUNT DEFICIT

2021 ◽  
Vol 6 (11) ◽  
pp. 220-240
Author(s):  
Mustafa IŞIK ◽  
Yakup ÖZSEZER ◽  
Fikriye IŞIK
Keyword(s):  
Current Account ◽  
Current Account Deficit ◽  
National Income ◽  
Tourism Industry ◽  
Added Value ◽  
Growth Effect ◽  
Critical Threshold ◽  
Current Account Balance ◽  
Health Tourism ◽  
Tourism Sector

Tourism sector is one of the major driving forces to develop the Turkish economy which provides the positive contributions with new employment opportunities and the national income and payments. With aid of this developments in economy by tourism, it has also increased the interaction with alternative areas. Health Tourism is also one of the special areas in which provides to the country high added value and foreign currency exchange income. Since the revenue outcome by health tourism is reaching up to 100 billion dollars, the national policy of health tourism enable countries has been undertaken as a high interested point of investment needed area. The critical threshold of the country’s Gross Domestic Product (GDP) is 4 to 5 percent as a current account balance and this deficient outcome in Turkey mostly takes on 5 to 4 percent which is a considered as a critical threshold. Health Tourism is expected to play a key role in bringing the values to the positive levels and therefore the focus is becoming on this area by health sector. Developing countries such as India, Singapore, and Thailand meet their foreign trade deficits with the income where they have obtained from this specific sector and the level of growth in this sector is at certain rate every year. The health Tourism is very crucial and significant sector for such a country Turkey, who has current budget deficit, and it is real economic sense. With Covid-19 crisis, the plans related with health tourism is re-evaluated by the coordination between Turkish Ministry of Health, Ministry of Tourism and Ministry of Economy. Especially, with the infrastructure works carried for public and city hospitals has been capable of providing health tourism services within the organization which is called “USHAŞ (International Health Services)”. The health tourism sector offers significant opportunities for Turkey during Covid-19 pandemic effects on our current account deficit and the decline in economic recovery of our tourism industry and losses. With health tourism created opportunities is already in an increasing trend, to contribute to the country’s economy much faster by increasing target markets with public-private cooperation.

What Explains Current Account Surplus in Korea?

2018 ◽  
Vol 17 (2) ◽  
pp. 70-93
Author(s):  
Chirok Han ◽  
Kwanho Shin
Keyword(s):  
Exchange Rate ◽  
Fiscal Policy ◽  
Current Account ◽  
Current Account Balance ◽  
Budget Deficits ◽  
Current Account Surplus ◽  
Short Run ◽  
The Right ◽  
The Impact ◽  
The Current Account

Since the currency crisis in 1998, Korea has experienced continuous current account surpluses. Recently, the current account surplus increased more rapidly—amounting to 7.7 percent of GDP in 2015. In this paper, we investigate the underlying reasons for the widening of Korea's current account surpluses. We find that the upward trend in Korea's current account surpluses is largely explained by its demographical changes. Other economic variables are only helpful when explaining short run fluctuations in current account balances. Moreover, we show that Korea's current account surplus is expected to disappear by 2042 as it becomes one of the most aged economies in the world. Demographic changes are so powerful that they explain, quite successfully, the current account balance trends of other economies with highly aged populations such as Japan, Germany, Italy, Finland, and Greece. When we add the real exchange rate as an additional explanatory variable, it is statistically significant with the right sign, but the magnitude explained by it is quite limited. For example, to reduce the current account surplus by 1 percentage point, a 12 percent depreciation is needed. If Korea's current exchange rate is undervalued 4 to 12 percent less than the level consistent with fundamentals, it is impossible to reduce Korea's current account surplus to a reasonable level by adjusting the exchange rate alone. Another way to reduce current account surplus is to expand fiscal policies. We find, however, that the impact of fiscal adjustments in reducing current account surplus is even more limited. According to our estimates, reducing the current account surplus by 1 percentage point requires an increase in budget deficits (as a ratio to GDP) of 5 to 6 percentage points. If we allow endogenous movements of exchange rate and fiscal policy, the impact of exchange rate adjustment increases by 1.6 times but that of fiscal policy decreases that it is no longer statistically significant.

scholarly journals Impact of International Trade and Trade Duties on Current Account Balance of the Balance of Payment: A study of N-11 Countries

2020 ◽  
Vol 6 (1) ◽  
pp. 11-32
Author(s):  
Imtiaz Arif ◽  
Lubna Khan ◽  
Fatima Farooq ◽  
Tahir Suleman
Keyword(s):  
International Trade ◽  
Current Account ◽  
Current Account Deficit ◽  
Unit Root Test ◽  
Future Research ◽  
Current Account Balance ◽  
Test Panel ◽  
Causality Analysis ◽  
Integration Test ◽  
The Impact

This study is aimed to investigate the impact of international trade and trade duties upon the current account balance of the balance of payment of N-11 countries. Two constituents of each factor have been considered for the purpose of analysis. For International trade, import (IMPT) and export (EXPT) of goods and services have been considered whereas, for trade duties, taxes on international trade (TOIT) and customs and other import duties (CID) have been taken as the research variables whereas, current account balance (CAB) has been taken as the dependent variable. For the purpose of analysis panel data of N-11 countries for 27 years from 1990 to 2016 has been tested using different econometric technique such as Panel unit root test, Panel co-integration test, Hausman test, Panel regression analysis and Panel causality analysis. The results demonstrate that overall research variables are co-integrated and having long term relationship and affecting each other in the conventional manner. Notably, it is observed via results that in case of N-11 countries the CAB itself is the regulating factor and all other factors are adjusted according to the movement of CAB. The study provides recommendations for the rectification of current account deficit position and also provides scope for future research as well.

scholarly journals The Harberger-Laursen-Metzler Effect: Evidence from Pakistan

2012 ◽  
Vol 17 (2) ◽  
pp. 87-110 ◽  
Author(s):  
Tayyaba Idrees ◽  
Saira Tufail
Keyword(s):  
Time Series ◽  
Current Account ◽  
Vector Autoregression ◽  
Real Income ◽  
Terms Of Trade ◽  
Temporary Increase ◽  
Current Account Balance ◽  
Time Series Dataset ◽  
The Current Account

According to the Harberger-Laursen-Metzler (HLM) effect, an exogenous temporary increase in the terms of trade leads to an improvement in the current account balance. This paper uses a recursive vector autoregression to investigate empirically the existence of the HLM effect in Pakistan, using a time series dataset for the period 1980–2009. Two important results emerge. First, real income deteriorates with an improvement in the terms of trade. Second, the current account balance also responds negatively to innovations in the terms of trade, which implies that the HLM effect does not exist in Pakistan.

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