Current Account Determinants for Oil-Exporting Countries

February 1, 2009

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Format: Chicago

Hanan Morsy. Current Account Determinants for Oil-Exporting Countries, (USA: International Monetary Fund, 2009) accessed December 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

The paper aims at characterizing the main determinants of the medium-term current account balance for oil-exporting countries using dynamic panel estimation techniques. Previous studies included a very limited number of oil-exporting countries in their samples, raising concerns about the applicability of the estimated coefficients for oil countries. Furthermore, current approaches are not specifically tailored to oil-producing countries because they fail to capture the effects of oil wealth and the degree of maturity in oil production. This paper explores the underlying determinants of the current account balance for a large sample of oilexporting countries, and extends the specifications commonly used in the literature to include an oil wealth variable, as well as a proxy for the degree of maturity in oil production. The paper therefore contributes to the existing literature both in terms of the sample studied as well as the variables considered. The results reveal that factors that matter in determining the equilibrium current account balance of oil-exporting counties are the fiscal balance, the oil balance, oil wealth, age dependency, and the degree of maturity in oil production.

Subject: Balance of payments, Commodities, Current account, Current account balance, Fiscal policy, Fiscal stance, Oil, Oil production, Production

Keywords: Current account, Current account balance, Current account behavior, Current account development, Current account position, Effects estimation, Estimate, Estimation result, Fiscal stance, Oil, Oil balance coefficient, Oil exporters, Oil production, Ratio, Regressions Using GMM, Variable, WP

Publication Details

Pages:

15
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2009/028
Stock No:

WPIEA2009028
ISBN:

9781451871753
ISSN:

1018-5941

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