@article {29947,
	title = {Global versus Country-Specific Productivity Shocks and the Current Account},
	journal = {Journal of Monetary Economics},
	volume = {35},
	year = {1995},
	note = {{\textcopyright} Copyright Elsevier Science. Posted with permission of Elsevier Science. One copy may be printed for individual use only.},
	pages = {159-92},
	abstract = {This paper develops an analytically tractable empirical model of investment and the current account, and applies it to data from the G-7 countries. This distinction between global and country-specific shock turns out to be quite important for explaining current account behavior; overall the model performs surprisingly well. One apparent puzzle, however, is that the current account responds by much less than investment to country-specific shocks, despite the near unit root behavior of these shocks. We show theoretically that this apparent anomaly can be explained if the shocks have very slow mean reversion.},
	author = {Reuven Glick and Kenneth Rogoff}
}
