Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212846 
Year of Publication: 
2016
Series/Report no.: 
BOFIT Discussion Papers No. 3/2016
Publisher: 
Bank of Finland, Institute for Economies in Transition (BOFIT), Helsinki
Abstract: 
​This study empirically examines the validity of the twin and triple deficits hypotheses using bootstrap panel Granger causality analysis and an annual panel data set of six post-communist countries (Russia, Poland, Ukraine, Romania, the Czech Republic, and Hungary) from 1994 to 2012. Our findings, based on panel data analysis under cross-sectional dependence and country-specific heterogeneity, support neither the twin deficits hypothesis nor its extended version, the triple deficits hypothesis, for any of the countries considered. In other words, we find no Granger-causal relationship between budget deficits and trade (or current account) deficits or among budget deficits, private savings-investment deficits, and trade deficits.
JEL: 
E60
F30
F32
H62
Persistent Identifier of the first edition: 
ISBN: 
978-952-323-091-0
Document Type: 
Working Paper

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