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Alberto Rinaldi and Barbara Pistoresi
''A note on Italy's current account sustainability: 1861-2010''
( 2014, Vol. 34 No.2 )
By using an original dataset, this paper analyzes the sustainability of Italy's current accounts over the years 1861-2010. We find empirical support to sustainability: the Italian economy used external deficits (surpluses) to smooth aggregate consumption. Persistent current account deficits from 1861 to WW1 seem to have been used to prompt the nation's productivity and economic efficiency and so they do not seem to have undermined the nation's intertemporal solvency.
Keywords: Current account sustainability, economic growth, Italy, unit root tests, Granger causality
JEL: E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data)
O1 - Economic Development: General
Manuscript Received : Apr 29 2014 Manuscript Accepted : Jun 01 2014

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