European Parliament Library

The Evolution of Current Account Deficits in the Euro Area Periphery and the Baltics :, Many Paths to the Same Endpoint, Joong Kang, Jay Shambaugh

Explanations of the large current account deficits for the euro area periphery and the Baltics in the run up to the crisis revolve around two main factors: deteriorating export performance or demand driven booms. We add that there were important movements in transfers and net income balances. While export performance remained relatively stable in most countries, for some countries, when transfers declined, households and firms borrowed so as to maintain the same level of spending. This was part of a persistent failure to adjust to trade deficits, which, along with rising net income payments, led to growing current account deficits. All of these factors played varying roles in the development of current account deficits across these countries
Table Of Contents
Cover; Contents; I. Introduction; Figures; Figure 1. Current Account; Figure 2. CPI-Based REER; Figure 3. Economy-wide ULC; Figure 4. Merchandise Export Market Share; Figure 5. ULC Increase; Figure 6. Change in Exports and Imports; Figure 7. Current Account Development; II. Different Paths to External Imbalances; A. Exports; Figure 8. Estonia: Exports and ULC growth; B. Imports; Table; Table 1. Market Share of Merchandise Exports (ex-Euro Area); Figure 9. Latvia: Net Capital Flows & ULC; Figure 10. Housing Prices (1997=100); C. Non-Trade Components; Figure 11. Portugal: Growth Decomposition
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (24 p.)
Specific Material Designation
Form Of Item

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