Despite the large size of U.S. net financial obligations to foreigners, U. S. residents have continued to earn more income on their assets abroad than foreigners have on their assets in the United States. In other words, the rate of return on U.S.-owned assets abroad is still higher than the...

This paper derives and estimates a current account model from the perspective that the current account balance is the difference between national savings and investment. This approach allows us to include determinants of savings, investment, and capital flows to explain and forecast the...

This paper examines past currency crises to shed light on the likelihood that the adjustment of the U.S. current account deficit will involve a dollar crisis. A currency crisis is narrowly defined to be a depreciation that exceeds a critical threshold, regardless of whether it has an adverse...

Since China began its pro-market reform in 1978, its management of capital flows has followed a cautious learning-by-doing approach, guided by the goal of propelling strong economic growth while minimizing risk to stability. Claiming that the country’s financial infrastructure is still not...

This paper uses a large cross-country panel dataset to estimate models of national saving rates and addresses two related issues. First, to what extent can China’s saving rate be explained by models of saving rates? Second, what are the factors responsible for China’s extraordinarily high...

This paper proposes and investigates the "asynchronization hypothesis," which predicts that an asynchronized shock tends to have a stronger and longer effect on the U.S. business cycle than an internationally synchronized shock. The hypothesis finds empirical support in the impulse responses of...