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Does Demographic Change Affect the Current Account? A Reconsideration

Graff, Michael ; Tang, Kam Ki ; Zhang, Jie

In: Global Economy Journal, 2012, vol. 12, no. 4, p. -

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    Titre
    • Does Demographic Change Affect the Current Account? A Reconsideration
    Auteur
    • Graff, Michael. Jacobs University Bremen and ETH Zurich
    • Tang, Kam Ki. University of Queensland
    • Zhang, Jie. National University of Singapore
    Type de document
    • Postprint
    Identifiant OAI-PMH
    • oai:doc.rero.ch:290161
    Summary
    This paper re-examines the impact of demographic factors on the current account balance. To this end, we develop an analytical framework that is more general than the one commonly used in the literature in three aspects. First, it accounts for the facts that the world current account balance must be equal to zero. Second, a bigger economy will have greater impacts on others, but be influenced less by them. Third, a more open economy will have greater impacts on others and at the same time be more readily influenced by them. We then confront two alternative empirical specifications based on both the new and the conventional framework with a panel of data. In contrast to the findings based on the conventional framework, our results with the new framework indicate that population ageing does not appear to have discernible impacts on the current account balance