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Is the Current Account Deficit Sustainable?
Author(s) -
Makin A. J.
Publication year - 1989
Publication title -
australian economic review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.308
H-Index - 29
eISSN - 1467-8462
pISSN - 0004-9018
DOI - 10.1111/j.1467-8462.1989.tb00322.x
Subject(s) - current account , scope (computer science) , economics , investment (military) , macroeconomics , deficit spending , current (fluid) , fiscal deficit , fiscal policy , monetary economics , economic policy , international economics , political science , politics , exchange rate , engineering , debt , computer science , electrical engineering , law , programming language
This article argues that Australia's savings behaviour relative to its investment opportunities ensures a structural current account deficit which is fundamentally sustainable. In fact considerable scope seems to exist for it to widen further, irrespective of fiscal tightening that has occurred during the last few years, without alarming macroeconomic consequences.