Current Account Imbalances

The aim of this book is to investigate the empirical relationships between current account balances and a broad set of variables. The determinants are chosen carefully from different strands of literature and also from other previous well-known studies. The two data frequencies used yielded roughly the same results. I found that GDP growth and investment for all the samples are negatively correlated with the current account balance in the annual data analysis. Savings on the other hand is positively correlated with current account especially in UpperMiddle-Income Countries.