Assessing the Current Account Sustainability in ECCAS economies: A Dual Cointegration Analysis

AMBA OYON, Claude Marius and Mbratana, Taoufiki and Gilles Quentin, Kane (2017): Assessing the Current Account Sustainability in ECCAS economies: A Dual Cointegration Analysis.

Abstract

This paper examines the sustainability of the current account defcits in eight Economic Community of Central African States (ECCAS). The empirical investigation rely on both panel and Intra-panel approach to test for long-run relationship between variables. Furthermore, non-linearity as well as asymmetric adjustment of Enders and Siklos (2001) is taken into account in cointegration analysis. Results from panel analysis show that; although exports and imports are cointegrated, the current account defcits is weakly sustainable in ECCAS over the period 1970 to 2015. These results also hold in each country’s analysis. Therefore, these eight ECCAS countries should implement policies to reinforce the sustainability of the current account defcits

• Item Type: MPRA Paper
• Language: English
• Keywords: Current account, Sustainability, ECCAS, Threshold Cointegration
• Subjects: C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables; F - International Economics > F3 - International Finance > F32 - Current Account Adjustment ; Short-Term Capital Movements

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