Untangling the US Deficit: Evaluating Causes, Cures and Global Imbalances

by Richard A. IIey, Mervyn K. Lewis

Overview

As the US current account deficit has expanded to a record level of $811 billion in 2006, debate about the deficit's causes and consequences has also grown. Is the deficit a product of American profligacy or a 'glut of savings' in the rest of the world? Is it a serious problem or essentially benign? Untangling the US Deficit charts a course between the competing explanations in a systematic and rigorous approach, incorporating the latest academic research and market data. Particular attention is given to the China-United States trade imbalance and to the special role of the US dollar and US capital markets in global finance.

This unique and well-researched book will be of great interest to academic economists and postgraduates. Policy-makers, business and market economists will also find it to be an enlightening and challenging account.

Product Details

ISBN-13:	9781845429201
Publisher:	Edward Elgar Publishing
Publication date:	10/28/2007
Pages:	288
Product dimensions:	6.30(w) x 9.20(h) x 1.10(d)

About the Author

Richard A. Iley, Chief Asia Economist, SPX Capital and Mervyn K. Lewis, Emeritus Professor, University of South Australia and Emeritus Fellow, Academy of the Social Sciences in Australia

Table of Contents

Contents: Preface 1. The Essence of the Problem 2. The Trade Perspective 3. National Accounting Perspectives 4. The International Perspective 5. Nature of the Adjustment Mechanisms 6. The Sustainability of the Deficit 7. The Demand for US Assets 8. China and the United States 9. Conclusion References Index

Editorial Reviews

'What are the causes of the US current account deficit? Are the problems "made in the US" or the rest of the world? Are these deficits sustainable, at what level? These are the types of questions the authors set out to answer, and in essence conclude that the answers do not matter for global stability as long as imbalances are left to market forces and the US can avoid large net income outflows. The beauty of this book, however, is watching the authors (the unusual combination of a business economist and an academic economist) arrive at this conclusion. They provide insights that can come only from years of practical and theoretical experience.'

William E. Becker

'The book would be a good companion text for an undergraduate class in international finance or open-economy macroeconomics.'

Catherine L. Mann

'The book is written in a very accessible fashion, even though the authors strive to accommodate competing and complex views on the causes and cures of the US external deficit, which makes for enjoyable and informative reading. Their reliance on data, charts and bibliography result in persuasive arguments. Recommended. General readers; upper-division undergraduates through practitioners.'

A. Sharma

'Untangling the US Deficit is a unique and well-researched book and will be of great interest to academic economists and postgraduates. Policymakers, business and market economists will also find it an enlightening and challenging analysis.'

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