An Equilibrium Model of "Global Imbalances" and Low Interest Rates Export

@article{citeulike:4759054, abstract = {The sustained rise in US current account deficits, the stubborn decline in longrun real rates, and the rise in US assets in global portfolios appear as anomalies from the perspective of conventional models. This paper rationalizes these facts as an equilibrium outcome when different regions of the world differ in their capacity to generate financial assets from real investments. Extensions of the basic model generate exchange rate and foreign direct investment excess returns broadly consistent with the recent trends in these variables. The framework is flexible enough to shed light on a range of scenarios in a global equilibrium environment.}, author = {Caballero, Ricardo J. and Fahri, Emmanuel and Gournichas, Pierre-Olivier}, citeulike-article-id = {4759054}, citeulike-linkout-0 = {http://econ-www.mit.edu/files/2733}, journal = {American Economic Review}, keywords = {bop, capital, flow, fx, saving}, number = {`}, pages = {358--393}, posted-at = {2009-06-06 06:40:41}, priority = {2}, title = {An Equilibrium Model of "Global Imbalances" and Low Interest Rates}, url = {http://econ-www.mit.edu/files/2733}, volume = {98}, year = {2008} }

TY - JOUR ID - citeulike:4759054 L3 - citeulike-article-id:4759054 N2 - The sustained rise in US current account deficits, the stubborn decline in longrun real rates, and the rise in US assets in global portfolios appear as anomalies from the perspective of conventional models. This paper rationalizes these facts as an equilibrium outcome when different regions of the world differ in their capacity to generate financial assets from real investments. Extensions of the basic model generate exchange rate and foreign direct investment excess returns broadly consistent with the recent trends in these variables. The framework is flexible enough to shed light on a range of scenarios in a global equilibrium environment. IS - ` JF - American Economic Review EP - 393 TI - An Equilibrium Model of "Global Imbalances" and Low Interest Rates VL - 98 SP - 358 KW - bop KW - capital KW - flow KW - fx KW - saving AU - Caballero, Ricardo AU - Fahri, Emmanuel AU - Gournichas, Pierre-Olivier PY - 2008/// UR - http://econ-www.mit.edu/files/2733 ER -