Present value tests of the Brazilian current account

Detalhes bibliográficos
Autor(a) principal: Rocha, Fabiana
Data de Publicação: 2000
Outros Autores: Bender, Siegfried
Tipo de documento: Artigo
Idioma: eng
Título da fonte: Economia Aplicada
Texto Completo: https://www.revistas.usp.br/ecoa/article/view/218773
Resumo: During the 90s, and in particular after the adoption of the Real Plan in 1994, a clear deterioration in the Brazilian current account has been observed. This fact attracted immediate attention to the question of whether or not the economy is obeying its external present value constraint, i.e., whether the current account deficit is on a sustainable path.The purpose of this paper is to investigate the "long run tendency" of the Brazilian current account. The procedure used is to estimate cointegrating regressions between exports and imports plus interest rate payments. Initial evidence from the regressions suggests that from 1947 to 1997 the long-run Brazilian current account was not zero. As we use a long span of data we also examine if there are any structural breaks in the cointegrating vectors in the face of regime changes. Since 1982 there has been an apparent structural shift in the relationship between trade flows. With the break, however, the results do not change. Conditions for intertemporal budget balance are still not satisfied.
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spelling Present value tests of the Brazilian current accountcurrent accountsustainabilitystructural breaksBrazilDuring the 90s, and in particular after the adoption of the Real Plan in 1994, a clear deterioration in the Brazilian current account has been observed. This fact attracted immediate attention to the question of whether or not the economy is obeying its external present value constraint, i.e., whether the current account deficit is on a sustainable path.The purpose of this paper is to investigate the "long run tendency" of the Brazilian current account. The procedure used is to estimate cointegrating regressions between exports and imports plus interest rate payments. Initial evidence from the regressions suggests that from 1947 to 1997 the long-run Brazilian current account was not zero. As we use a long span of data we also examine if there are any structural breaks in the cointegrating vectors in the face of regime changes. Since 1982 there has been an apparent structural shift in the relationship between trade flows. With the break, however, the results do not change. Conditions for intertemporal budget balance are still not satisfied.Universidade de São Paulo, FEA-RP/USP2000-04-30info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionapplication/pdfhttps://www.revistas.usp.br/ecoa/article/view/21877310.11606/1413-8050/ea218773Economia Aplicada; Vol. 4 Núm. 2 (2000); 203-222Economia Aplicada; Vol. 4 No. 2 (2000); 203-222Economia Aplicada; v. 4 n. 2 (2000); 203-2221980-53301413-8050reponame:Economia Aplicadainstname:Universidade de São Paulo (USP)instacron:USPenghttps://www.revistas.usp.br/ecoa/article/view/218773/199878Copyright (c) 2000 Economia Aplicadahttp://creativecommons.org/licenses/by-nc/4.0info:eu-repo/semantics/openAccessRocha, Fabiana Bender, Siegfried 2023-11-13T13:03:53Zoai:revistas.usp.br:article/218773Revistahttps://www.revistas.usp.br/ecoaPUBhttps://www.revistas.usp.br/ecoa/oai||revecap@usp.br1980-53301413-8050opendoar:2023-11-13T13:03:53Economia Aplicada - Universidade de São Paulo (USP)false
dc.title.none.fl_str_mv Present value tests of the Brazilian current account
title Present value tests of the Brazilian current account
spellingShingle Present value tests of the Brazilian current account
Rocha, Fabiana
current account
sustainability
structural breaks
Brazil
title_short Present value tests of the Brazilian current account
title_full Present value tests of the Brazilian current account
title_fullStr Present value tests of the Brazilian current account
title_full_unstemmed Present value tests of the Brazilian current account
title_sort Present value tests of the Brazilian current account
author Rocha, Fabiana
author_facet Rocha, Fabiana
Bender, Siegfried
author_role author
author2 Bender, Siegfried
author2_role author
dc.contributor.author.fl_str_mv Rocha, Fabiana
Bender, Siegfried
dc.subject.por.fl_str_mv current account
sustainability
structural breaks
Brazil
topic current account
sustainability
structural breaks
Brazil
description During the 90s, and in particular after the adoption of the Real Plan in 1994, a clear deterioration in the Brazilian current account has been observed. This fact attracted immediate attention to the question of whether or not the economy is obeying its external present value constraint, i.e., whether the current account deficit is on a sustainable path.The purpose of this paper is to investigate the "long run tendency" of the Brazilian current account. The procedure used is to estimate cointegrating regressions between exports and imports plus interest rate payments. Initial evidence from the regressions suggests that from 1947 to 1997 the long-run Brazilian current account was not zero. As we use a long span of data we also examine if there are any structural breaks in the cointegrating vectors in the face of regime changes. Since 1982 there has been an apparent structural shift in the relationship between trade flows. With the break, however, the results do not change. Conditions for intertemporal budget balance are still not satisfied.
publishDate 2000
dc.date.none.fl_str_mv 2000-04-30
dc.type.driver.fl_str_mv info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
format article
status_str publishedVersion
dc.identifier.uri.fl_str_mv https://www.revistas.usp.br/ecoa/article/view/218773
10.11606/1413-8050/ea218773
url https://www.revistas.usp.br/ecoa/article/view/218773
identifier_str_mv 10.11606/1413-8050/ea218773
dc.language.iso.fl_str_mv eng
language eng
dc.relation.none.fl_str_mv https://www.revistas.usp.br/ecoa/article/view/218773/199878
dc.rights.driver.fl_str_mv Copyright (c) 2000 Economia Aplicada
http://creativecommons.org/licenses/by-nc/4.0
info:eu-repo/semantics/openAccess
rights_invalid_str_mv Copyright (c) 2000 Economia Aplicada
http://creativecommons.org/licenses/by-nc/4.0
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Universidade de São Paulo, FEA-RP/USP
publisher.none.fl_str_mv Universidade de São Paulo, FEA-RP/USP
dc.source.none.fl_str_mv Economia Aplicada; Vol. 4 Núm. 2 (2000); 203-222
Economia Aplicada; Vol. 4 No. 2 (2000); 203-222
Economia Aplicada; v. 4 n. 2 (2000); 203-222
1980-5330
1413-8050
reponame:Economia Aplicada
instname:Universidade de São Paulo (USP)
instacron:USP
instname_str Universidade de São Paulo (USP)
instacron_str USP
institution USP
reponame_str Economia Aplicada
collection Economia Aplicada
repository.name.fl_str_mv Economia Aplicada - Universidade de São Paulo (USP)
repository.mail.fl_str_mv ||revecap@usp.br
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