A supply-side explanation for current account imbalances

Advanced economies with relatively high manufacturing shares tend to have current account surpluses. One reason for this is the dominant role played by transactions involving manufactured goods in world trade. An additional factor is that the catching-up process in emerging and developing economies has been accompanied by a marked boom in investment. Countries with relatively large manufacturing sectors specialising in capital equipment are correspondingly better placed to achieve trade surpluses.

[Full text of articles can be found in the Intereconomics Archive two years after the initial publication]

Intereconomics: Archive http://archive.intereconomics.eu/years/

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