Public debt, saving-investment-current account dynamics, and capital mobility in OECD countries, 1999-2013

• Sal Amirkhalkhali ^[1] ; Atul Dar
  1. [1] Saint Mary's University

     Saint Mary's University

     Canadá

     
• Localización: Applied econometrics and international development, ISSN 1578-4487, Vol. 16, Nº. 1, 2016, págs. 5-12
• Idioma: inglés
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• Resumen

  • Are countries with higher relative public debt levels also characterized by lower capital mobility? This paper attempts to address this question empirically by applying an error correction model of saving-investment-current account to data from 27 OECD countries over the 1999-2013 interval. We classify countries into five groups on the basis of the relative size of public debt. Our empirical results appear to support a stable current account which is indicative of low capital mobility or binding credit constraints when the public debt is high relative to GDP