International Capital Mobility and Current Account Targeting in Central and Eastern European Countries

The paper examines the degree of financial integration in five central and eastern European economies on the basis of saving-investment correlations. A comparison with eleven member states of the European monetary union shows that the countries under review have already reached a higher degree of integration in quantitative terms. Since this approach is sensitive to current account targeting policies, the paper uses econometric techniques to control for these kinds of policies indicating that the central and eastern European countries that suffered from current account crises in the past might have used fiscal policies to balance the current account.

Köhler, Matthias (2007), International Capital Mobility and Current Account Targeting in Central and Eastern European Countries, in: Klaus Liebscher, Josef Christel, Peter Mooslechner, Doris Ritzberger-Grünwald (Hrsg.), Financial Development, Integration and Stability, Edward Elgar Publishing, Cheltenham, UK, 489-508