Will the Unemployment Rate Fall with a Robust Forecast for the U.S. Current Account Balance?
Keywords:Balance of payment, Current account balance, US trade deficit.
AbstractThis paper investigates the relationship between the U.S. current account balance and the U.S. rate of unemployment. Would the improvement in the current account balance cause a fall in the unemployment rate? Although previous researchers argued that U.S. current account balance does not influence U.S. unemployment rate, this article shows that these two are statistically correlated. This article also suggests policy recommendations that benefit both the employment level and the U.S. current account balance.
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