Relying on hard currency or dollarizing an economy has been a common practice of many developing countries taking the form of dollarizing bank deposits and loans, settling transactions in dollars and the indexation of wages and prices in dollars. The relationship between dollarization and...

It is argued that the sustainability of external debts depends on the stationarity of the current account balance. This study tests for the stationarity of current account deficits for a sample of sixteen Latin American countries, employing a new test, advocated by Breuer et al. (2002), that...

The study examines the long-run sustainability of OECD current account balances. For this purpose, tests for current account stationarity and then cointegration between exports and imports are based on recently developed panel data methods that offer increased power over existing time-series...

This paper investigates the possibility that the adjustment towards long-run relative purchasing power parity (PPP) is dependent upon the nature of deviations from PPP that are experienced. While existing studies involving developed and less developed countries often find against PPP having...