Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/194775 
Year of Publication: 
2018
Citation: 
[Journal:] Cogent Economics & Finance [ISSN:] 2332-2039 [Volume:] 6 [Issue:] 1 [Publisher:] Taylor & Francis [Place:] Abingdon [Year:] 2018 [Pages:] 1-42
Publisher: 
Taylor & Francis, Abingdon
Abstract: 
In this paper, we examine the various links among external debt, trade openness and current account in Sub-Saharan Africa, utilizing an approach that highlights current account from the perspective of saving and investment. We explore whether external debt aids the subsequent adjustment process of current account deficits in SSA. We also examine the role of openness in the adjustment process. Empirical analysis using large panel data samples of Sub-Saharan African countries between 1985 and 2013 shows that external debt mostly sets the tone for the subsequent adjustment of current account deficits in SSA. However, the current account deficits of countries with high openness expand significantly from increases in external debt. The results are robust to different time periods and econometric estimation techniques, the inclusion of other current account determinants as control variables and consideration of endogeneity.
Subjects: 
external debt
trade openness
current account balance
endogeneity
JEL: 
F30
F32
F40
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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