Determinants of the current account for a group of European countries

Abstract

This paper has tried to find some of the determinants of the current account in six European countries to try to explain why some of them have surpluses and other current account deficit. By regressing six explanatory variables they were obtained those with greater significance for each country. The results show a heteroskedasticity between countries which helps to understand the different current account balances. This divergence between the significant variables of each of the countries listed as the macroeconomic policies adopted by each of the countries during these 41 years are generating so different current account balances.