value of FDI assets are loosening the sustainability constraint on the trade balance and therefore generate persistent trade … temporary external deficits. We show that our enhanced DSGE-model - covering both trade and FDI - not only matches well the … dynamics of the US external balance but can also account for the observed evolution of FDI related components of the external …

The EU and the US have started negotiations on a Transatlantic Trade and Investment Partnership Agreement (TTIP) which …