In some countries, a sizable fraction of savings is derived from corporate savings. Although larger, traded corporations are often co-owned by foreign portfolio investors, current international accounting standards allocate all corporate savings to the host country. This paper suggests a...

In some countries, a sizable fraction of savings is derived from corporate savings. Although larger, traded corporations are often co-owned by foreign portfolio investors, current international accounting standards allocate all corporate savings to the host country. This paper suggests a...

This paper documents that cross-border investment income flows are important for explaining current account balances in major economies. Those investment incomes reflect returns on cross-border asset holdings and on balance often reach magnitudes around 5% of major economies' gross domestic...

Over recent years, several euro area countries have registered large and persistent net foreign liabilities. This paper examines the risks arising from these external stock imbalances, the prospects for their smooth unwinding and the menu of policy options. The paper demonstrates that external...

This paper assesses the vulnerability of Latin American and Caribbean (LAC) economies to external crises. It shows that while the average LAC economy has made significant strides to reduce vulnerability to crises to its historical minimum, there is still considerable room for improvement,...

This paper explores the empirical determinants of external crises on a world panel dataset of 62 countries over the fifty-year period 1970-2019 and estimates their risk trade-offs with the aim of informing macrofinancial prudential policies. The determinants include countries' external balance...

We examine the hypothesis that one of the fundamental factors behind the Euro Area (EA) crisis is the reversal of intra-EA capital flows between the ‘core' and ‘periphery' economies. We compile a data set on aggregate and disaggregate gross and net intra-EA flows between Germany and Greece,...

This paper identifies the cyclical drivers of the current account balance (CAB) in Türkiye and assesses the relevant macro policy implications. We employ the notion of "underlying current account", which corrects for cyclical factors such as global and domestic growth, terms of trade, as well...

The purpose of this study is to assess, from a Balance of Payment Constraint Growth (BPCG) theoretical perspective, current key challenges of developing countries that spring from two broad exogenous factors. These factors are: i) global shocks that affect the world economy, and ii) major...

This paper examines two competing approaches for calculating current account benchmarks, i.e. the external sustainability approach á la Lane and Milesi-Ferretti (LM) versus the structural current accounts literature (SCA) based on panel econometric techniques. The aim is to gauge the medium...