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G7 Current Account Imbalances: Sustainability and Adjustment

G7 Current Account Imbalances: Sustainability and Adjustment
Richard H. Clarida, editor

Some chapters may have appeared as NBER Working Papers, which are preliminary versions of the published papers.

Table of Contents:

Introduction, p. 1-8
Richard H. Clarida

I. Origins of G7 Current Account Imbalances

1. From World Banker to World Venture Capitalist: U.S. External Adjustment and the Exorbitant Privilege, p. 11-55
Pierre-Olivier Gourinchas and Hélène Rey

Comment: José De Gregorio, p. 56-66

2. A Global Perspective on External Positions, p. 67-98
Philip R. Lane and Gian Maria Milesi-Ferretti

Comment: Richard Portes, p. 99-102

3. Direct Investment, Rising Real Wages, and the Absorption of Excess Labor in the Periphery, p. 103-126
Michael P. Dooley, David Folkerts-Landau and Peter Garber

Comment: Shang-Jin Wei, p. 126-130

II. Empirical Studies of G7 Current Account and Exchange Rate Adjustment

4. Current Account Deficits in Industrial Countries: The Bigger They Are the Harder They Fall?, p. 133-162
Caroline Freund and Frank Warnock

Comment: Assaf Razin, p. 162-167

5. Are There Thresholds of Current Account Adjustment in the G7? p. 169-200
Richard H. Clarida, Manuela Goretti, and Mark P. Taylor

Comment: Robert E. Cumby, p. 201-203

6. Current Account Reversals: Always a Problem? p. 205-242
Muge Adalet and Barry Eichengreen

Comment: Frederic S. Mishkin, p. 242-245

7. Understanding the U.S. Trade Deficit: A Disaggregated Perspective, p. 247-278
Catherine L. Mann and Katharina Plück

Comment: Peter B. Kenen, p. 278-281

8. Will the Euro Eventually Surpass the Dollar as Leading International Reserve Currency? p. 283-322
Menzie Chinn and Jeffrey A. Frankel

Comment: Edwin M. Truman, p. 322-335

III. Theoretical Perspectives on Current Account Sustainability and Adjustment

9. The Unsustainability U.S. Current Account Position Revisited, p. 339-366
Maurice Obstfeld and Kenneth Rogoff

Comment: Kristin J. Forbes, p. 367-375

10. Smooth Landing or Crash? Model-Based Scenarios of Global Current Account Rebalancing, p. 377-451
Hamid Faruqee, Douglas Laxton, Dirk Muir and Paolo A. Pesenti

Comment: Lars E. O. Svensson, p. 451-455

11. The Dot-Com Bubble, the Bush Deficits, and the U.S. Current Account, p. 457-492
Aart Kraay and Jaume Ventura

Comment: Joseph E. Gagnon, p. 492-495